Jake Z Posted September 15, 2007 Share Posted September 15, 2007 "Move along, nothing to see here", says the BoE! http://news.bbc.co.uk/1/hi/business/6996136.stm Move to quell Northern Rock fears Mortgage lender Northern Rock says it has not yet had to borrow the money granted by the Bank of England as an emergency lending facility. Experts reassured customers the bank would not go bust as many queued to withdraw their savings on Friday. Shares in the group fell by 32% after it emerged it had approached the Bank of England for help. The bank has struggled to raise money to finance its lending ever since money markets seized up over the summer. The Newcastle-based bank warned it could have £150m shaved off its profits due to the money market turmoil. On Friday thousands of customers visited Northern Rock bank branches across the country to withdraw savings, fearful the business could collapse. Several customers showed BBC reporters slips that suggest they withdrew sums of £100,000 and more. Reports estimate that savers took £1bn out of their accounts on Friday, but Northern Rock has not confirmed this figure. Tony Looch, a 68-year-old customer, who queued for nearly two hours at Northern Rock's Moorgate branch in central London, said: "My confidence has been shattered. I would not put a penny into that company again." Another lender outside a branch in Newcastle city centre asked: "If they are short of funds, what happens to our funds?" But a number of officials and experts tried to reassure the bank's 1.5 million savers their money was safe. Michael Coogan, of the Council of Mortgage Lenders, said he felt customers had over-reacted.... Quote Link to comment Share on other sites More sharing options...
GCS15 Posted September 15, 2007 Share Posted September 15, 2007 Michael Coogan, of the Council of Mortgage Lenders, said he felt customers had over-reacted.... Excuse me Michael. How much of your life savings do you hold in NR? Quote Link to comment Share on other sites More sharing options...
Ash4781 Posted September 15, 2007 Share Posted September 15, 2007 Ouch will that 1bn will need to be replaced by BoE ? Quote Link to comment Share on other sites More sharing options...
mobeyone Posted September 15, 2007 Share Posted September 15, 2007 Excuse me Michael. How much of your life savings do you hold in NR? I know - what a c*ock!! Hw was trying so hard aswell to convince the viewers all is ok!! Quote Link to comment Share on other sites More sharing options...
Methinkshe Posted September 15, 2007 Share Posted September 15, 2007 Do branches of Northern Rock customarily open on a Saturday? If so, it will be interesting to see whether all the soothing noises have had any effect on Joe Public or whether yesterday's queues will be repeated. Quote Link to comment Share on other sites More sharing options...
EmpiricalBear Posted September 15, 2007 Share Posted September 15, 2007 Just reported on Today R4 that dozens of customers are queuing outside NR branches... Seems that the collateral NR has can just cover the deposits. So if everyone took out their money, NR would have simply evaporated, but the depositors got their money. Where will they put it? Hope not into BTL, otherwise we will see one hell of a BRRRRRP - BLAAAAAT! Quote Link to comment Share on other sites More sharing options...
The Ayatollah Buggeri Posted September 15, 2007 Share Posted September 15, 2007 The chief exec claimed yesterday that NR hold a total of £24bn in retail deposits, and that the BoE has offered them £36bn in emergency credit if they need it. Therefore, he argued, even if every last penny of retail savings were withdrawn, NR would still be afloat. If those figures are true, I suppose that scenario's better than letting NR go down and take a significant proportion of depositors' savings with it. Given that their only operating credit would be at a much higher interest rates than that of their competitors, I can't see how NR could survive in the long-term if this happened. New mortgage business would all but stop, because they wouldn't be able to offer loans to even remotely 'prime' borrowers that other lenders couldn't offer at better rates. Quote Link to comment Share on other sites More sharing options...
munimula Posted September 15, 2007 Share Posted September 15, 2007 "Move along, nothing to see here", says the BoE!http://news.bbc.co.uk/1/hi/business/6996136.stm Move to quell Northern Rock fears On Friday thousands of customers visited Northern Rock bank branches across the country to withdraw savings, fearful the business could collapse. Several customers showed BBC reporters slips that suggest they withdrew sums of £100,000 and more. Reports estimate that savers took £1bn out of their accounts on Friday, but Northern Rock has not confirmed this figure. I'm in the process of advising my parents to move over £400k out of B&B to Tesco and Abbey (6.75% and 6.3% respectively). If things get worse then how are these banks going to survive? If NR was suffering before people started withdrawing all that money and the credit crunch continues then surely it's bust? And that will be followed by B&B. I learnt yesterday that NR finance lending with only 24% of savers money, B&B was next with just 40%. To compare, Nationwide is 70%. The rest is borrowed elsewhere. Quote Link to comment Share on other sites More sharing options...
CapeFear Posted September 15, 2007 Share Posted September 15, 2007 I'm in the process of advising my parents to move over £400k out of B&B to Tesco and Abbey (6.75% and 6.3% respectively). Less convinced about Abbey. But Tesco must be one of the safest plays imaginable - a minor diversification of one of the most respected businesses on the planet... Quote Link to comment Share on other sites More sharing options...
MRMX9 Posted September 15, 2007 Share Posted September 15, 2007 Less convinced about Abbey.But Tesco must be one of the safest plays imaginable - a minor diversification of one of the most respected businesses on the planet... Tesco's savings accounts and credit cards are administered by Royal Bank of Scotland aren't they? I would only put my savings now in a proper building society and spread the money around so that you have no more than £30k in each e.g. Nationwide, Yorkshire, Britannia. If you have a small local building society in your area (e.g. Leek United, Nottingham, Saffron etc) even better. Sensible Northern Rock customers in the north east should head straight to their local Newcastle Building Society branch! Many of the current local building societies have been around since the Crimean war so apart from keeping your savings under a pillow they are your best bet. My personal recommendation is National Counties (www.ncbs.co.uk) - massive savings reserves and few mortgages plus they pay far better rates than the Northern Rock! A full list of building societies with weblinks can be found here: http://www.rpoints.com/carpetbagger/societies.php Quote Link to comment Share on other sites More sharing options...
Battenberg Posted September 15, 2007 Share Posted September 15, 2007 Tesco's savings accounts and credit cards are administered by Royal Bank of Scotland aren't they?I would only put my savings now in a proper building society and spread the money around so that you have no more than £30k in each e.g. Nationwide, Yorkshire, Britannia. If you have a small local building society in your area (e.g. Leek United, Nottingham, Saffron etc) even better. Sensible Northern Rock customers in the north east should head straight to their local Newcastle Building Society branch! Many of the current local building societies have been around since the Crimean war so apart from keeping your savings under a pillow they are your best bet. My personal recommendation is National Counties (www.ncbs.co.uk) - massive savings reserves and few mortgages plus they pay far better rates than the Northern Rock! A full list of building societies with weblinks can be found here: http://www.rpoints.com/carpetbagger/societies.php ITA, our savings are with Tesco via Royal Bank of Scotland and I had the same thought last night about moving our money to a building society. Quote Link to comment Share on other sites More sharing options...
Methinkshe Posted September 15, 2007 Share Posted September 15, 2007 Tesco's savings accounts and credit cards are administered by Royal Bank of Scotland aren't they?I would only put my savings now in a proper building society and spread the money around so that you have no more than £30k in each e.g. Nationwide, Yorkshire, Britannia. If you have a small local building society in your area (e.g. Leek United, Nottingham, Saffron etc) even better. Sensible Northern Rock customers in the north east should head straight to their local Newcastle Building Society branch! Many of the current local building societies have been around since the Crimean war so apart from keeping your savings under a pillow they are your best bet. My personal recommendation is National Counties (www.ncbs.co.uk) - massive savings reserves and few mortgages plus they pay far better rates than the Northern Rock! A full list of building societies with weblinks can be found here: http://www.rpoints.com/carpetbagger/societies.php Someone on this site doesn't think Britannia is a good bet. HERE Quote Link to comment Share on other sites More sharing options...
ex-MEWer Posted September 15, 2007 Share Posted September 15, 2007 An alternative spin on this is it's shocking just how much money is sloshing around in the UK! HPC? Hmmmm Quote Link to comment Share on other sites More sharing options...
@contradevian Posted September 15, 2007 Share Posted September 15, 2007 An alternative spin on this is it's shocking just how much money is sloshing around in the UK! HPC? Hmmmm "The debts of the many outweigh the savings of the few (or the one)." --Mr Spock - Star Trek - The Wrath of Khan Live Long and Prosper. Quote Link to comment Share on other sites More sharing options...
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