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Hsbc Warns Branch Network 'uneconomic'

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We have maintained, and will continue to maintain, a liquid balance sheet," Mr Geoghegan said. "However, it is worth noting that with interest rates at historic lows, the cost of maintaining this liquidity is high, and the economics of running a major retail network do not stack up when deposit margins have all but vanished."

http://www.telegraph.co.uk/finance/newsbys...uneconomic.html

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What's a deposit margin?

Then can close them all if they can work out an alternative way of people paying cash into a bank.

If you think about the high street - all those bank branches - all doing the same basic customer thing. money in, money out They could rationalise if they could allow each other to put money in through other banks.

What would you need? One bank per small town? Autmated tills like nationwide have to deal with the vast majority of things...

could save a fortune.

but all those jobs going ...

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What's a deposit margin?

Then can close them all if they can work out an alternative way of people paying cash into a bank.

If you think about the high street - all those bank branches - all doing the same basic customer thing. money in, money out They could rationalise if they could allow each other to put money in through other banks.

What would you need? One bank per small town? Autmated tills like nationwide have to deal with the vast majority of things...

could save a fortune.

but all those jobs going ...

Lots of branches have closed already and been converted into Starbucks and Weatherspoons.

This is a lame arguement about margins. The margins are better than they have ever been. 0% on current account deposits and 17% odd on overdrafts.

The rationale of the branch network in the past was the ability to cross-sell products like investments, insurance and mortgages. This is what has taken a hit through imposed transparancy of the products they sell and lack of demand.

Also sacking a few people is a great way to limit wage demands from the survivors.

Fair enough I say. In these troubled times it is reasonable that the powerless should suffer to maintain the bonuses of their superiors.

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Lots of branches have closed already and been converted into Starbucks and Weatherspoons.

This is a lame arguement about margins. The margins are better than they have ever been. 0% on current account deposits and 17% odd on overdrafts.

The rationale of the branch network in the past was the ability to cross-sell products like investments, insurance and mortgages. This is what has taken a hit through imposed transparancy of the products they sell and lack of demand.

Also sacking a few people is a great way to limit wage demands from the survivors.

Fair enough I say. In these troubled times it is reasonable that the powerless should suffer to maintain the bonuses of their superiors.

I agree with your sentiments but i think the argument may go a little deeper, the Banks will have to react to major misselling scandals which will be coming up shortly to do with self cert , BTL and other problems. your right about the cross selling issues as all bank staff target customers with large deposits, and they make you go into branch to discuss investements. Obviously HSBC see an end to this selling opportunity probably as a result of new regulations, you have to realise how close these people are to the government and they will know well in advance of what is coming from the FSA.

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Every thing can be done over the phone, why have branches that cost you.

Have you noticed the Victorians and Edwardians housed banks in very solid and imposing buildings with a feel of permanency about them.

Unfortunately most have been behaving like Arthur Daley and may as well have been run out of a rented portacabin and their reputation is now such that there is no longer any brand value or image to be protected. That is why they want to close them.

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I can post a cheque but can't post coins.

Their solution to the current crisis is to remove notes and coins as far as is possible.

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Their solution to the current crisis is to remove notes and coins as far as is possible.

yup. that'd fit in with the hmrc plan to watch as you spend

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yup. that'd fit in with the hmrc plan to watch as you spend

I missed this.

Is this a further assult on personal liberty with hmrc monitoring personal expenditure?

Have you a link.

We really need to take a step back from virtual electronic money because it will be used as a weapon against us.

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I missed this.

Is this a further assult on personal liberty with hmrc monitoring personal expenditure?

Have you a link.

We really need to take a step back from virtual electronic money because it will be used as a weapon against us.

http://emsnews.wordpress.com/2009/05/20/pr...i-cash-finance/

Economics as a science and economic reality have never had problems with negative real (inflation-adjusted) interest rates. So what is the problem with nominal rates? In a word, it’s currency.

Elaine Supkis' anaylsis is spot on as always.

http://blogs.ft.com/maverecon/2009/05/nega...near-you/#_ftn1

Original proposition.

Insane.

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Their solution to the current crisis is to remove notes and coins as far as is possible.

Sadly you are correct.

Money transmission is costly. Staff are costly. Branch networks are costly. We are heading full speed to a cashless, chequeless banking system where money will simply be scooped out of your account by an automated global operations centre in Mumbai.

This will all happen very quickly and with no choice. You will not be able to operate outside the debt banking system. It is very clear. For some reason most people appear to think it is a good idea.

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Sadly you are correct.

Money transmission is costly. Staff are costly. Branch networks are costly. We are heading full speed to a cashless, chequeless banking system where money will simply be scooped out of your account by an automated global operations centre in Mumbai.

This will all happen very quickly and with no choice. You will not be able to operate outside the debt banking system. It is very clear. For some reason most people appear to think it is a good idea.

It cannot possibly work.

Not a chance at all. no way, no how.

Sans an objective measurement there can be no economy. There will be no accurate price signals anywhere.

They'll bring it in and we'll all starve to death. :ph34r:

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Perhaps the banks - and shops - would have more customers if they were open at the times when people who have jobs (ie money) have time to go to them.

This government has forced more and more people into work - 15 years ago maybe one partner would be free during the day to shop/bank - dramatically fewer are now in that position.

Best way to sort it out - open the shops at 12 - 9 and move the saturday/sunday closing to a weekday.

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http://emsnews.wordpress.com/2009/05/20/pr...i-cash-finance/

Economics as a science and economic reality have never had problems with negative real (inflation-adjusted) interest rates. So what is the problem with nominal rates? In a word, it’s currency.

Elaine Supkis' anaylsis is spot on as always.

http://blogs.ft.com/maverecon/2009/05/nega...near-you/#_ftn1

Original proposition.

Insane.

How would this work.

At over (less than) say -0.5 rates most people would pay for a safe deposit box or take the risk of storing it under the floorboards. Then the Government would have to put sell by dates on notes and people would horde PM instead. Then they would have to make PM hording illegal so people would buy 24K bangles and pendants as jewelery.

It all happened already at various times and places especially in less sophisticated economies and dictatorships towards which we seem to be heading

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How would this work.

At over (less than) say -0.5 rates most people would pay for a safe deposit box or take the risk of storing it under the floorboards. Then the Government would have to put sell by dates on notes and people would horde PM instead. Then they would have to make PM hording illegal so people would buy 24K bangles and pendants as jewelery.

It all happened already at various times and places especially in less sophisticated economies and dictatorships towards which we seem to be heading

They just time stamp all currency so notes and coins stop being of use in 12 months.

Then they ban gold.

Then they ban ciggies in public, ban alcohol in public so you can't rade with those easily etc etc

They'll just get madder and madder and weirder and weirder until they finally collapse. Hopefully that will be very quickly, for the alternative is decades of inertia, secret prisons, economic failure and internal warfare. I'm betting that it is.

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I missed this.

Is this a further assult on personal liberty with hmrc monitoring personal expenditure?

Have you a link.

We really need to take a step back from virtual electronic money because it will be used as a weapon against us.

It might be the government plan, but I think that the banks only care about the bottom line - and bits and bytes cost a lot less to manage than notes and coins.

A few posters on this thread seem worried about physical cash being made obsolete - I suspect that the opposite might happen: as the small businesses that run on cash (taxis, bars,...) find it impossible to put their cash in to the bank, then they'll go for the path of least resistance, i.e. spend the cash at the supermarket (instead of getting their never-never card out). The total amount of cash in circulation might even go up.

Oh, and as far as I know, none of the electronic purses that have been tried out so far have had any success whatsoever ;)

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Sadly you are correct.

Money transmission is costly. Staff are costly. Branch networks are costly. We are heading full speed to a cashless, chequeless banking system where money will simply be scooped out of your account by an automated global operations centre in Mumbai.

This will all happen very quickly and with no choice. You will not be able to operate outside the debt banking system. It is very clear. For some reason most people appear to think it is a good idea.

Yes but Banks have Alway's taken those costs as part of running a bleedin bank!

They are going to con us into a cashless society, then cause massive corruption problems with money being stolen out of ten's thousands accounts.

The Final Solution offered will be "Accept the 'chip' in your Forehead or Hand"

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I must admit I never go into my bank unless I really have to. It has become a place for the hard sell, and I just cant be bothered with that.

I found this with other institutes a few years ago while trying to open an ISA. It wasnt possible to go in and just do it, one had to make an appointment with a financial advisor for them to review your finances. Dream on. :lol:

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Yes but Banks have Alway's taken those costs as part of running a bleedin bank!

They are going to con us into a cashless society, then cause massive corruption problems with money being stolen out of ten's thousands accounts.

The Final Solution offered will be "Accept the 'chip' in your Forehead or Hand"

I think you are correct.

Most of us are now government employees or recipients of government handouts and are paid electronically so difficult get out of the system

Injins link showed how easy it would be to abolish currency with the excuse that the only beneficiary of coins and notes are tax evaders, terrorists and money lauderers - the same reasons you can now be pulled out of your bed at night and locked up without explanation or just reason or even shot dead.

Edited by dr ray

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Sadly you are correct.

Money transmission is costly. Staff are costly. Branch networks are costly. We are heading full speed to a cashless, chequeless banking system where money will simply be scooped out of your account by an automated global operations centre in Mumbai.

This will all happen very quickly and with no choice. You will not be able to operate outside the debt banking system. It is very clear. For some reason most people appear to think it is a good idea.

people will start operating a black economy...gold coins or something.The system will be sidetracked eventually.I can see the powers setting it in motion but it will not stick....

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