Saturday, Mar 22, 2008
Who's crying Now ?
Timesonline: Governor must do more to help banks, says Burt
The former deputy chairman of HBOS accused the Bank of England yesterday of failing to support British banks through the global credit crisis.
Sir Peter Burt, who was chief executive of Bank of Scotland before its merger with Halifax to create HBOS, told the BBC’s Today programme that the Bank risked sending Britain into a “depression” because of its worries over moral hazard.
Speaking two days after the Bank was forced to make an unprecedented statement denying that any bank had sought emergency state funding, Sir Peter said that Mervyn King, its Governor, should “go the extra mile” by offering more cash and accepting a wider range of collateral, as had the US Federal Reserve.
The Claws seem to be Out
Posted by plato @ 10:46 AM (658 views) Add Comment
16 Comments
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1. inbreda said...
I have tried to log on to abbey national site this morning and it is not working. I expect everyhting is fine, but I can't help worrying that the websites going offline could indicate something very bad has happened. We all know that the banks are in a right mess, and I wonder if it is time to start getting scared if you have savings in Abbey?
2. Icarus said...
What's the evidence that 'liquidity injections' etc. by the Fed and the ECB have actually worked? I don't see cash-rich French and German banks entering the UK mortgage market to take the place of cash-strapped UK lenders.
3. plato said...
Inbreda
This is going to be the attitude of a Nation. (This is Big and uncontrollable.It's fired by Distrust.) I have already had people coming to me for advice and I can only tell them that panic spreads. None of us can stop this. None of us has wished this. We have wished for Justice and this is very different. That is why I read this Site.
The blame lies squarely with those in real control but the punishment will be to all and proportionately worse for the middle classes.
Perhaps by some Miracle and I mean Miracle this will all blow away, but the chasm seems to be widening. Once anything gains enough momentum it can only be stopped by destruction. Lets hope it doesn't reach this level.
4. the northerner living in oz said...
They reduced there IT staffing levels a few months ago
so do not read to much into it.
5. denzil said...
This sort of crap gets on my nerves. The Banks have acted recklessly over the last half dozen years, during that time huge bonuses have been generated by those working and leading the banks. They were blinkered by huge bonuses during which time they lost the ability to see any farther than the end of their noses and now it's all gone wrong they want the BoE and the humble tax payer to pick up the pieces. It stinks!
On top of that, I'm sick of the banks claiming it is the credit crunch that caused it and they did not see it coming. That may be true but oddly enough seasoned bloggers on this site saw the credit crunch coming ages back but the leaders of Banks didn't?!? Incompetent wanchors.
6. Stevie Dee said...
What a Burk!!!
7. mrmickey said...
This Burk or Burt was on the radio yesterday saying the BOE should accept any rubbish as collateral against loans to these banks just to keep this whole sorry mess going for a few years more giving the banks a chance to reload and have another go at srewing things up. He argued that the people running banks like Northern Rock do get punished for making mistakes because they lose their jobs in the end, the fact that they made a stack of cash in the process seemed to pass him by.
8. Jimmyb said...
denzil - you are so right, the banks should be allowed to go under and let the market dictate what happens, that would teach em.
9. holding out said...
I heard him on Radio 4 the other day as well. He even cited as an example cheif executive Charles Price losing his job as paying the price. But who's paying? He got hugh a salary and bonuses when everything was going OK and as soon as it goes tits up he gets a great big pay off as well.
In the US it looks like they are going to do whatever it takes to prop up all the banks and doubtless we'll do the same
10. enuii said...
Since when did the Bank of England turn into a Cash Converters style pawn shop for Bankers?
11. p. doff said...
Inbreda @ 1
'and I wonder if it is time to start getting scared if you have savings in Abbey? '
Don't say that. I'm getting increasingly worried about my bank deposits and have decided to be sensible and spread it around. I've just transferred £30K out of HBOS Websaver into my HSBC current a/c intending to stick it in either Abbey or Northern Rock (as they are offering more than 'a little Xtra'). I was thinking NS&I might be a good home for the next tranche. I can't see a problem if you keep your deposits below £35K - can you?
12. Letthemfall said...
I wonder if Sir Burk would offer me a few 100K in return for collateral of a pile of horsesh1t. I imagine he knows the value of that very well.
13. Cheekie Charlie said...
"they should be able to swap a wider range of assets, including their mortgages, for loans from the Bank of England"
Isn't this the same as securitisation which got us into this unholy mess in the first place? There must be something fundamentally wrong with purchasing debt with debt! When I read more and more comparisons with our situation with the great depression I think actions like this will lead us directly to one. The problem is the present politicians are spineless and are just putting it off so it doesn't occur on their watch. I think Mr. Brown has alot to answer for and I hope the BBC will one day ask the questions rather than saturating their channel with property cheerleading programmes. Does this make them liable to mis-selling?
14. tyrellcorporation said...
All mine are £30k chunks. Pulled out of Icesave though a month or so ago.
15. Maihem said...
Does anybody know what happens to stocks and shares owned in a fund when the bank managing the fund goes bust? What about if the fund is a strict index tracker - could they make it stop tracking the index and simply take all the shares for themselves/creditors instead of returning them to the fund participants?
16. mark wadsworth said...
Icarus makes a stupendously good point, actually.