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The Masked Tulip

Bradford & Bingley, A&l, Paragon 'teetering'?

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Speculation has swirled for months about the collapse of an American bank as the credit crisis has escalated and spread from sub-prime to other mortgage-backed securities, treasuries and bonds. As well as Bear Stearns, attention has focused on UBS, the Swiss bank, which has been forced to make more than $18 billion in sub-prime writedowns, and Citigroup, the world's largest financial institution, which has turned to sovereign wealth funds to help to shore up its credit-stricken balance sheet.

Bankers say that mortgage lenders, such as Paragon, Alliance & Leicester and Bradford & Bingley, could also be teetering on the brink soon if they cannot raise enough money in the markets to continue to lend to customers. All the banks have denied that they are facing a cash crunch and each has said that its liquidity position is strong. Nonetheless, the speculation continues to mount. Alan Schwartz, the Bear Stearns chief executive, reiterated that stance yesterday after Punk Ziegel analysts gave warning that the bank could be forced to seek a merger partner.

Yet banking sources said yesterday that a collapse seemed inevitable. One senior banker in London said: “Someone will go under in this crisis, that's for sure. The question is whether they stay under or get rescued. Let's see whether this latest round of stabilisation helps, but if it doesn't, it's difficult to see what Plan B is. The Fed can't just keep on printing money.”

One problem with the credit crunch is that banks' solvency positions can change overnight. As banks force firesales of assets to recover their loans from hedge funds, the prices of those assets fall. But as the prices fall, the amount of capital that the banks need rises. Lena Komileva, a Tullett Prebon economist, said: “This is what is fuelling the vicious cycle. Things can deteriorate very rapidly and banks can reach insolvency almost overnight.”

http://business.timesonline.co.uk/tol/busi...icle3542775.ece

Is Paragon the BTL arm of Britannia building society?

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Glad that I took all bar a cash ISA out of A&L last week. Not looking good. Even the BBC is reporting trouble today.

I may just have to move my current account from A+L back to HSBC.

Moved my ISA out in January.

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I may just have to move my current account from A+L back to HSBC.

Moved my ISA out in January.

What makes you think HSBC is any sounder than A&L? They sold the family jewels to show a paper 'profit' last quarter, but how can you know whether they are not facing the same predicament as the others?

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What makes you think HSBC is any sounder than A&L? They sold the family jewels to show a paper 'profit' last quarter, but how can you know whether they are not facing the same predicament as the others?

And in any event, does it really matter? Either failing banks will be nationalised/guaranteed like Northern Rock, in which case your money is safe where it is, or the resulting carnage will destroy the rest of them too, in which case your money isn't safe with any of them.

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Imagine that - the government having 2 or 3 nationalised banks on it's hands :ph34r:

1, 2, 3 might as well get the tax payer to fork out for the lot of them.

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And in any event, does it really matter? Either failing banks will be nationalised/guaranteed like Northern Rock, in which case your money is safe where it is, or the resulting carnage will destroy the rest of them too, in which case your money isn't safe with any of them.

Or they let some fall and support some of the big boys? If another bank fails the sheeple are going to take a massive collective dump in their panties. I still think there will be moves from within Labour to get rid of Brown if any more carnage hits the headlines.

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WOuld be interesting if anymore do go pop and go into government control If say the A & L went would they combine it with NR and just have one larger bank with one set of staff and make surplus staff and branches redundant? dosent seem much point to running 2 seperate failling banks

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IMO, our banks are insolvent. As defaults begin to mount as the crash progresses we will be in EXACTLY the same boat as the US, only worse as our bubble is bigger and has more air to escape. One more NR situation and sterling and Brown are toast. We are indeed, teetering on the brink.

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IMO, our banks are insolvent. As defaults begin to mount as the crash progresses we will be in EXACTLY the same boat as the US, only worse as our bubble is bigger and has more air to escape. One more NR situation and sterling and Brown are toast. We are indeed, teetering on the brink.

I'm so excited.

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I'm so excited.

Me too! :lol:

Its what the bears have been waiting for-- the Big One and we can all be proud of the fact that we saw it coming and STR'd, STM'd and didn't buy back in, or just waited.

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I'm so excited.

Someways its exciting in other ways I have very bad feelings, not many sheeple out there understand whats going on, talk in work today is about 4p on drink and more on wine, if you mention about banks being in a bad way noone understands

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And in any event, does it really matter? Either failing banks will be nationalised/guaranteed like Northern Rock, in which case your money is safe where it is, or the resulting carnage will destroy the rest of them too, in which case your money isn't safe with any of them.

It does matter to me. I am trying to find a home for a 'large' sum of money and I don't feel like trusting any bank at the moment.

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Someways its exciting in other ways I have very bad feelings, not many sheeple out there understand whats going on, talk in work today is about 4p on drink and more on wine, if you mention about banks being in a bad way noone understands

Ignorance is bliss - until you are no longer ignorant.

If it all kicks off they've got the shock to come. You will have known about it before the event. It might be a relief !

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It does matter to me. I am trying to find a home for a 'large' sum of money and I don't feel like trusting any bank at the moment.

NS&I? Northern Rock? Probably the safest for GBP-denominated cash at the moment.

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Darling has gone quiet on the 100 FSA gaurantee that he was talking about last Autumn. I think they will use the 35K limit if - when - another bank goes bust and anyone who has more than that in a bank might end up stuffed. Worry for myself as I have my STR fund mostly in HBOS and Nationwide - spreading it around means the likes of A&L and B&B getting some.

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Someways its exciting in other ways I have very bad feelings, not many sheeple out there understand whats going on, talk in work today is about 4p on drink and more on wine, if you mention about banks being in a bad way noone understands

Quite right. I don't think people really understand the magnitude of what is happening in world financial markets. People choose not to understand.

A colleague asked me on Tuesday when I was buying a house. She proclaimed "it's the best investment you'll ever make". I tried to explain that my money is currenlty better off in a standard savings account. I also said that house prices will crash: "no they won't, don't be stupid".

Denial is huge at the moment.

BTW: Brent crude now a record on $106 / barrel. Just on News 24.

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Darling has gone quiet on the 100 FSA gaurantee that he was talking about last Autumn. I think they will use the 35K limit if - when - another bank goes bust and anyone who has more than that in a bank might end up stuffed. Worry for myself as I have my STR fund mostly in HBOS and Nationwide - spreading it around means the likes of A&L and B&B getting some.

And who is paying for the guarantee- its the other banks!- I think this is what they mean by the domino effect.

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NS&I? Northern Rock? Probably the safest for GBP-denominated cash at the moment.

Yes that's what I would have liked but I need to keep it in euros unfortunately (or fortunately depending on how you look at things).

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Quite right. I don't think people really understand the magnitude of what is happening in world financial markets. People choose not to understand.

A colleague asked me on Tuesday when I was buying a house. She proclaimed "it's the best investment you'll ever make". I tried to explain that my money is currenlty better off in a standard savings account. I also said that house prices will crash: "no they won't, don't be stupid".

Denial is huge at the moment.

BTW: Brent crude now a record on $106 / barrel. Just on News 24.

Same happened to me in the 90s, saw it coming in 89 at the very beginning and everybody was in complete denial. If anything I think they were a bit upset at me afterwards, as if I was somehow responsible. Tried again in 2004 with colleagues in the office (the beginning of the amateur BTL trend) but they were actually quite agressive when I mentioned prices could go down (no mention of a crash or anything).

Nowadays I just keep my mouth shut (outside of HPC that is) and enjoy the show.

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Imagine that - the government having 2 or 3 nationalised banks on it's hands :ph34r:

The thing is, the UK government have painted themselves into a corner with Northern Rock.

They *cannot afford* to mount such costly rescues on this scale.

And yet, by doing this for N.R., they have set a precedent, and people will whinge like mad if another bank was in trouble and they don't get "equal" treatment.....

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  • 293 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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