Tuesday, September 17, 2013

Barclays Bank Error In Your Favour - Collect £100M

I see that Barclays is fond of playing Monopoly, and has managed to create a bank error (for once in its customers' favour) that will entail a refund to affected customers (estimated at being around 300,000) of around £100M.

Barclays customers are to receive compensation because it miscalculated the interest owed on personal loans, the errors date back to October 2008.

Other divisions (Barclaycard, Barclays Wealth and Barclays Corporate) are now undertaking a review to see if customers were short-changed by the errors ("technical documentary errors").

Barclays will write to customers in the coming weeks. Barclays is quoted by the Telegraph saying that said it had "identified certain issues with the information contained in historic statements and arrears notices relating to consumer loan accounts. It is therefore implementing a plan to return interest incorrectly charged to customers".

A spokesman for the bank said:
"Barclays has proactively reviewed information it has historically sent to its customers relating to interest charges, where we have found technical documentary errors. As a result Barclays has identified certain issues with the information contained in some statements and arrears notices relating to consumer loan accounts. 

Due to these notification errors, interest was not due on certain accounts during the period that Barclays made this mistake, and whilst no one has been mis-sold to, customers are entitled to have their interest payments returned. No customer will pay more than they were ever contractually expected to. 

Barclays has notified the Office of Fair Trading (OFT), which is responsible for consumer credit issues, and is implementing a plan to return interest payments to customers as swiftly and efficiently as possible. Barclays is undertaking a review of all its businesses where similar issues could arise to assess any related issues. 

Any affected customer will be contacted by Barclays and customers do not need to take any action."
To add to Barclays shame, campaign group Move Your Money said that Barclays was the lowest scoring financial institution out of 70 assessed, scoring four out of 100 possible points for honesty and customer service.

Well done Barclays!

Friday, September 13, 2013

The TSB Goes From Strength To Strength

Following last week's website crash on its relaunch, the TSB has yet again managed to drop the ball; this time by mis-spelling Ashtead on a billboard advert aimed at the residents of Ashtead.

As per getSURREY:
"‘Welcome back to local banking’ was the message displayed to commuters on a TSB advertising board erected at Ashtead railway station this week.

But something rather important to local people got lost in translation - the spelling of the village they live in.

Now TSB bosses will be hoping that villagers can forgive their 'Hello Ashstead' howler.

A spokesman said on Thursday: 
“We apologise to local residents for the incorrect spelling.

"We are looking to rectify the poster as soon as possible.”

The company later tweeted an apology for the mistake."

Thursday, September 12, 2013

The Interminable Rise of Greek Youth Unemployment

In May Greek youth unemployment was almsot 65%, in June it showed a slight "improevment" falling to 58.8%.

However, when compared to previous years the level of youth unemployment has worsened (as per Efthimia Efthimiou):

- June 2012 it was 54.8%
- June 2011 it was 44.4%
- June 2010 it was 31.3%
- June 2009 it was 23.2%
- June 2008 it was 20%

Levels of unemployment such as this are normally associated with third world countries in the midst of a civil war, or the equivalent. Yet Greece is, allegedly, a first world country and is meant to be an "equal" member of a powerful and prosperous economic block (ie the Eurozone).

The reality is that Greece is not treated as an equal, it should never have joined or been allowed to join the Eurozone and the prosperity within the Eurozone is not evenly spread but confined to the wealthy Northern economies.

As such it is clear that as an experiment the Eurozone is destined to fail, indeed the world will be a better place without it. However, with levels of unemployment such as this in Greece the real danger is that of a plague of dictatorships and civil unrest spreading country by country in the Southern members of the Eurozone.

In order to survive as a democracy and civilised society Greece needs to exit the Eurozone now, others such as Cyprus need also to consider their positions. 

Wednesday, September 11, 2013

The Greek Problem - Two More Bailouts Needed

European Central Bank Governing Council member, Luc Coene, is quoted by Reuters:
"It's clear that we are not yet at the end of the Greek problem. 

We will need to make further efforts, certainly once, perhaps twice more. 

We will see how the situation develops."
My advice to Greece stands, leave the Eurozone and devalue your currency.

Unemployment Falls as Estate Agents Hire Staff

As I have noted before, the British economy is driven by the property market and people's confidence (usually misplaced, given that property prices are relative) that an increase in house prices is an increase in personal liquid wealth.

Thus it should come as no surprise to see that today's announcement that unemployment dropped to 7.7%, from 7.8% in the three months to April, is largely due to an upturn in confidence in the property market.

Overall 80,000 jobs were created over the period, significantly above the predictions by "experts" and economists of an increase of 55,000. However, accounting for a large part of this 80,000 increase was a rise in the number of "real estate" jobs (on the back of a surge in confidence in the property market) of 50,000.

NB: "Real estate" jobs are in the main estate agents.

Tuesday, September 10, 2013

Wheatley Lambasts Outrageous PPI Mis-selling

Martin Wheatley, the CEO of the Financial Conduct Authority (FCA), is currently appearing before the Treasury Select Committee. He is less than impressed with the fallout from the PPI mis-selling scandal and the way that the banks are handling complaints.

Currently the FOS is upholding 90% of PPI mis-selling cases referred to it after they had been rejected by the banks.

Wheatley says it is "absolutely not acceptable" and that it is "outrageous" that the number upheld by the FOS is so high. He stated that the FCA has been looking into how banks handle complaints, as per the Telegraph:
"We have taken action and we will take more action and we will continue to look at how banks handle complaints. 

We've got two large investigations underway and have two cases where we have issued strong fines."
Sadly PPI mis-selling is but one of many areas where Britain's financial services industry mired itself in its own shit.

Monday, September 9, 2013

TSB Website Crashes

The newly launched TSB bank (split for Lloyds) has had a less than stellar first day, as its website has crashed.

Hardly a good augury for the future!

Monday, September 2, 2013

Fred The Shred and The Round Topped Filing Cabinets

The Telegraph reports that Fred Goodwin, erstwhile CEO of RBS, was so obsessed with tidiness and so irritated with piles of paper on filing cabinets that he ordered thousands of custom-made round-topped storage units to be rolled out across the bank.

A senior manager told Iain Martin, the author of Making it Happen: Fred Goodwin, RBS and the Men Who Blew Up the British Economy being published next week.
Somewhere in a warehouse are thousands of old flat-top RBS filing cabinets that were not Fred-compliant.” 
In pre RBS days as chief executive of Clydesdale Bank, Goodwin apparently interrupted a meeting to take a call from his mother who had seen a cigarette butt left on the steps of the bank’s headquarters in Glasgow. Goodwin immediately arranged to have the butt removed.

Sadly this obsessive attention to detail didn't manifest itself in the more "mundane" activities of the bank such as credit, risk and how much is lent and to whom.

Sunday, September 1, 2013

Net Worth Update (August 2013)

Current Net Worth
Assets
Jul-13
Aug-13
Change
% change
Savings Account 1
$2,759.47
$2,706.00
($53.47)
-1.94
Savings Account 2
$3,223.53
$5,116.49
$1,892.96
58.72
Savings Account 3
$25,093.43
$26,325.95
$1,232.52
4.91
Investment Linked Fund
$8,922.62
$8,128.83
($793.79)
-8.90
Schroders Commodity Fund
$9,334.73
$9,722.21
$387.48
4.15
Stock Holdings
$9,680.00
$8,760.00
($920.00)
-9.50
Phillip Money Market Fund
$15,037.05
$15,042.25
$5.20
0.03
Physical cash
$1,000.00
$1,000.00
$0.00
0.00
Market Value Of BTO Flat (to be built in 2016/2017)
$750,000.00
$750,000.00
$0.00

Total Assets
$825,050.83
$826,801.73
$1,750.90
0.21





Liabilities




Home Loan
$617,500
$617,500
$0.00
0.00





Net Worth (including flat to be built in 2016/2017)
$207,550.83
$209,301.73
$1,750.90
0.84
Investible Net Worth
$75,050.83
$76,801.73
$1,750.90
2.33


  • Cash/Cash equivalents increased by $3,077 in August. Total accumulated cash/cash equivalents is now $50,000. However, the drop in the value of my investment assets offset the increase in cash, resulting in a 2.3% increase in overall investible net worth.
  • Value of stock holdings and mutual funds decreased about 9-10% due to lacklustre economic data and the fear of a reduction in quantitative easing in the US.
  • First big hurdle for the markets in September will be the August employment report, which could dictate Fed's decision on the reduction of quantitative easing, which is speculated to happen in September.
  • Commodity fund rose 4% in August due to the conflict in Syria, coupled with the attack on a key pipeline in Iraq that reduced the country's oil exports by 290,000 a day. In addition, protests in Libya and disruptions on key pipelines in Nigeria contributed to the reduced global oil output.