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Hsbc Chairman Calls For Halt On Rules Ringfencing High-Street Business

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http://www.theguardian.com/business/2014/aug/03/hsbc-chairman-douglas-flint-calls-halt-rules-ringfencing-high-street-business

The chairman of HSBC is calling on the government to temporarily delay new rules intended to make the banking industry less vulnerable to crisis.

Douglas Flint is asking the government not to force banks to comply with new rules requiring them to "ringfence" their high street businesses from their casino investment banking arms while the industry undergoes a competition investigation.

The chairman of Britain's biggest bank, which is scheduled to publish first half results showing a drop in profits on Monday, has written to the chancellor, George Osborne, and senior regulators to make his views known.

The ringfencing requirements are a key plank of the reform ideas drawn up by the independent commission on banking, chaired by Sir John Vickers, The commission reported in 2011 after being set up by the coalition government when it was first formed in 2010.

But HSBC – which would not comment on the report by Sky News – is concerned that the reorganisation this will require by 2019 is taking place at the same time the Competition and Markets Authority conducts an investigation into the industry which could also require and lead to structural changes.

Of course the banks don't want to be split up as the taxpayer might not bail them out!

Edited by interestrateripoff

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Of course the banks don't want to be split up as the taxpayer might not bail them out!

If they had to split off the investment bank to sell it,they could probably do it in 6 months or less.When they're doing it for compliance reasons,all of a sudden it takes 6 years.

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1/2 year profits down to just $12bn

$2 profit for every living soul on the planet.

Hard times.

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HSBC says reform pressures unprecedented as profits drop 10:02am BST

LONDON - Europe's largest bank HSBC warned on Monday that a growing body of international regulations was putting its staff under unprecedented pressure and discouraging them from taking risks.

Reuters headline.

Strange I thought we were in this mess because bankers took too much risk, apparently risk is good.

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I think we all know enough about banking scum now to know that the only reason they do anything is to benefit themselves, no matter what the cost to anybody else.

A disgusting shower of shite, the more they moan the better, but even then they have nothign to complain about considering the way they have and still do parasite on the rest of us.

Edited by onlyme2

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Perhaps we could have a sort of moan index?

The more the banks moan, the better the regulation is working.

If they stop moaning, time to tighten the screws.

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Perhaps we could have a sort of moan index?

The more the banks moan, the better the regulation is working.

If they stop moaning, time to tighten the screws.

LIke a cheap whore you'd get fake moans from them.

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and discouraging them from taking risks.

:lol: This being the whole point of the new regulations. Somehow the bankers seem to have developed the idea that any rule that impedes their ability to make a profit is inherently flawed- but should one of their counter staff take a similar view to the rules and start helping themselves to the banks money I doubt they would agree.

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1/2 year profits down to just $12bn

$2 profit for every living soul on the planet.

Hard times.

This years profit is potentially next years tax payer funded liability.Plus ca change.

Shaun Richards used a great phrase to describe the situation viz any future RBS rights issue

'The UK has reverted to implicit methods to bailout RBS with Funding for Lending and Help to Buy improving the pricing of much of its asset book. Even so I fear further revelations as we have to miss-selling of interest-rate swaps and other derivatives still to come.'

It should be noted that HSBC has only ever used these 'implicit' forms of tax payer support before.

Edited by Sancho Panza

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Perhaps we could have a sort of moan index?

The more the banks moan, the better the regulation is working.

If they stop moaning, time to tighten the screws.

Slum landlords are always against slum clearances.

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It was reported on the BBC breakfast business spot that HSBC had just allocated more funds to pay off miss-sold PPI. Along with the collapse of BES in Portugal, Steph summarised this as mixed news. I was left wondering which part she thought was the good news. :lol:

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This years profit is potentially next years tax payer funded liability.Plus ca change.

Indeed. Good old Taleb and his asymmetric payoffs.

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If they had to split off the investment bank to sell it,they could probably do it in 6 months or less.When they're doing it for compliance reasons,all of a sudden it takes 6 years.

It will take about 6 years. Actually, the first bit of legislation has already been passed. The second bit is being prepared, which will have all the nitty gritty in.

In HSBC`s case, it is not about splitting off the investment bank, but rather about splitting off the UK retail bank from the rest of the multinational retail, corporate and investment bank. In reality, when it is down to the nuts and bolts, a very complex exercise. It is probably easier to merge a bank rather than split it - the former taking a couple of years to get all the IT sorted out.

The main UK banks do not want this at all - it is far cheaper to fund yourself with retail deposits than bonds. And if everyone thinks that the government will stand behind you, you can borrow more cheaply. Unsurprisingly, they are moaning about the costs of separation.

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HSBC says reform pressures unprecedented as profits drop 10:02am BST

LONDON - Europe's largest bank HSBC warned on Monday that a growing body of international regulations was putting its staff under unprecedented pressure and discouraging them from taking risks.

Reuters headline.

Strange I thought we were in this mess because bankers took too much risk, apparently risk is good.

In that case what's wrong with paying extra for the appropriate insurance...insure against the risks...... ;)

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In that case what's wrong with paying extra for the appropriate insurance...insure against the risks...... ;)

Hmm... didn't some clever banker/insurance types manage to repackage a huge quantity of subprime garbage into sweet smelling, low-risk AAA products which nobody could actually tell if they had a liability to when it all blew up?

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Hmm... didn't some clever banker/insurance types manage to repackage a huge quantity of subprime garbage into sweet smelling, low-risk AAA products which nobody could actually tell if they had a liability to when it all blew up?

There you go if it is uninsurable why should those who take no part in the activities/bets/risks/derivatives....money making for some huge losses for others who end up having to pay for it, the fall guys? ;)

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Quite. And by not separating it cleanly, they will spend forever lobbying to get it all reversed.

They are all absolute b*stards. I note Lloyds coming out in the press this weekend saying 'BoE's new mortgage rules will put customers' mortgages up'. They should be fined for blatantly lobbying against their regulator in this way.

Lloyds are actively wanting to be seen as the first bank to do this and be the one to be 'trusted'. They are getting affordability rules in place to a more stringent level than anyone else - and they are also aware this will cist them business in the short term.

This is all well known - but not publicised very much for some reason. . .

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It's the chipping away at any proposed banking restrictions until whatever remains is ineffective/not actually employed like before. So predictable.

When the next economic calamity happens (the one after this one that still hasn't even run its own course) they'll be saying yet again how they're going to restrict the culprits and introduce effective safeguards...................

They did the same after the 80s/90s economic calamity and those before that one so they'll be trying to do the same this time as well.

Edited by billybong

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It's the chipping away at any proposed banking restrictions until whatever remains is ineffective/not actually employed like before. So predictable.

When the next economic calamity happens (the one after this one that still hasn't even run its own course) they'll be saying yet again how they're going to restrict the culprits and introduce effective safeguards...................

They did the same after the 80s/90s economic calamity and those before that one so they'll be trying to do the same this time as well.

What was that you said about the current economic calamity not having run its course?

http://www.theguardian.com/money/2014/aug/04/latest-banking-scandal-mistakes-paperwork-loans-hire-purchase-credit-cards-store-cards

Credit and loan agreement errors likely to trigger multimillion-pound payouts

Latest banking scandal centres on mistakes in paperwork for loans, hire purchase agreements, plus credit and store cards
Monday 4 August 2014 19.44 BST

An epidemic of errors in credit and loan agreements is the latest expensive scandal to hit the banking sector, with the cost already approaching £1bn.

HSBC disclosed on Monday that it is setting aside hundreds of millions of pounds to refund customers for mistakes made in paperwork.

How did the latest debacle occur? This affects some personal loans, credit and store cards, and hire purchase agreements. It has nothing to do with the payment protection insurance (PPI) scandal.

Many of Britain's banks and building societies have discovered that some of the annual statements, arrears notices and other correspondence sent to customers holding these products did not comply with the Consumer Credit Act because they did not give all the information that people were entitled to by law.

In many cases, the offending paperwork did not include the required statutory wording. Under the law, borrowers are not liable for interest or default charges relating to a period when a lender has not provided the information, even if the original documentation was fully above board.

Affected customers are entitled to a refund of the interest or fees they were charged over the period that the errors occurred. One common error is that loan statements failed to include the original amount borrowed. The act requires such statements to contain the sum borrowed, plus the opening and closing balance.

http://www.theguardian.com/business/2014/aug/05/moodys-downgrades-outlook-uk-banking-sector-negative

Moody's downgrades outlook for UK banking sector to negative
Ratings agency's reasons include new rules intended to prevent taxpayer bailouts, and banks' exposure to fines and lawsuits

Tuesday 5 August 2014 13.03 BST

The UK's major banks are exposed to multi-milllion pound fines and lawsuits that could dent their profits, the rating's agency Moody's warned on Tuesday, as it downgraded its outlook for the sector because of new rules intended to prevent another taxpayer bailout.

The agency reduced its outlook from stable to negative, because of the uncertainty faced by lenders to banks as a result of the ringfencing high street arms from "casino" investment banking businesses. The new rules will mean taxpayers are less likely to bail out banks in the future.

The ringfences, born out of the independent commission on banking chaired by Sir John Vickers in 2011, need to be in place by 2019, but the HSBC chairman, Douglas Flint, has called on the government for time to make the changes, which the bank has argued will cost millions of pounds.

Flint said on Monday that there was a "growing fatigue" in some of the bank's operations, where staff were having to work at weekends to implement systems changes, in part caused by the ringfencing rules.

Moody's said: "We expect the related changes in business models, organisation and funding structure changes to have significant implementation costs over a multi-year period, which, given their early stage of development, have yet to be reflected in banks' bottom lines".

Edited by zugzwang

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Banks respond to ring-fence plans

The UK's biggest banks will tell the Bank of England this week how they plan to respond to controversial new rules designed to protect consumers from lenders’ riskier investment banking arms. The rules require large banks to legally separate their volatile wholesale arms from their UK retail banks. Although some of these banks to submit plans this week are not yet of a size that requires them to meet the ring-fencing requirements, any bank that expects to be by 2019 must submit details of their expected structuring.

https://uk.finance.yahoo.com/news/banks-respond-ring-fence-plans-201524291.html

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