Fed concern at sub-prime insurers by Finance News Bulletin

Published: 10/04/08

Federal Reserve boss Ben Bernanke is keeping an eye on bond insurers, which guarantee the products at the heart of the US sub-prime mortgage crisis.

Mr Bernanke said that the insurers' problems could have an adverse effect on financial markets and the economy.

Bond insurers are reeling after the value of the US mortgage-backed investments they had guaranteed fell.

Analysts fear the insurers will not be able to pay out, forcing banks to announce another big round of losses.

If the issuer of a bond goes bust, they guarantee to step in and make interest rate payments and repay the principal.

MBIA, the largest US bond insurer, said on Wednesday it would raise $750m (£384m) by issuing new shares, after it made a net loss of $2.3bn in the three months ending 31 December.

However, rating agency Fitch said MBIA's main bond insurance unit could lose its top triple-A rating even with new capital, because it faces big potential losses after guaranteeing repackaged sub-prime debt.

If their credit ratings are cut, it could make it harder or more expensive for bond insurers to raise the money to pay banks and other institutions.

"Given the adverse effects that problems of financial guarantors can have on financial markets and the economy, we are closely monitoring developments," Federal Reserve Chairman Ben Bernanke said in a letter.

The 4 February letter was to Paul Kanjorksi, the chairman of the House of Representatives subcommittee that overseas capital markets.

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Lloyds TSB: Brits unconcerned by cyber-crime - Published:14/09/07

Some 51 per cent of Britons do not have concerns about internet banking deception, new research revealsA quarter of the nation suggests that cyber-crime is not a be anxious for them because there is nothing which can be done to prevent it, according to a review by Lloyds TSBTwo-fifths of British people are not bothered about online crime because they believe their store will always reimburse their lossIan Larkin, managing director of customer banking at Lloyds TSB, said that the bank does all it can to stop fraudsters from being successfulHe remarks: "Internet deception is an issue no one can afford to ignore and it is by no means a victimless crime"Its impact stretches distant beyond the customer whose money is taken and the bank it is taken from, with the proceeds often used to finance other more serious crime around the world"The Federation of Small Businesses recently exposed that the danger of online credit card fraud is deterring a number.

Ombudsman gets tough on banks over unfair charges - Published:03/09/07

All occasions are London occasion Search News in the FTcom siteSearchSearch Quotes in the FTcom siteQuotes Your moneyBreadcrumb trail navigation:FT Home > Your moneyEDITOR’S CHOICEOFT to probe overdraft penalty feesSurge in bad debts forces lenders to make tighter criteriaCredit card issuers slash 'unfair' penaltiesBanks face OFT threat on fees for overdraftsLATEST YOUR cash STORIESBorrowers set up home in never-never landLoad ’em up and take hold of the readiesWealthy investors urged to think affordable flatsClaimants pin hope on ombudsmanWelcome protection from exchange-listed funds Brokers punt on enlargement of demand for spread bettingGreen investment is still in its budding stageCyberspace, the final border for small investorsLettings market faces a manifold problemPut your feet up in a place in the sunBank clientele who complain about unfair charges are receiving record levels of compensation, in a growing symbol of banks’ willingness to settle claimsThe Financial Ombudsman Service has so far upheld 100 per cent of such customer complaints against banks, a record stance in favour of consumersThis follows a surge in complaints about fees connected to overdrafts In the history six months, the ombudsman has taken in as many as 1,000 criticisms about such fees and chargesWalter Merricks, the chief ombudsman, supposed: “Our preference is always to make your mind up disputes informally, as this is quicker and more efficient for everyone involved We have so far been clever to negotiate settlements, satisfactory to both sides, without having to escalate matters or make official decisions”Most of the letters sent by angry customers anxiety bank charges for bouncing a cheque or going overdrawnThe ombudsman indicated customers’ new height of awareness stemmed from the advertising regulators generated recently when they questioned whether these penalties are appropriate“I’m sure the novel interest is because of all the fanfare the Office of Fair Trading has generated on the matter,” supposed David Creswell, a spokesman for the ombudsmanWhile the leading trade collection for the banking industry defends overdraft charges as pale, it indicates the industry faces pressure to resolve complaints as a means to keep away from court cases“We hold these fees are fair and reasonable What is an unauthorised overdraft It’s a charge assessed if someone withdraws too much cash from their account,” said Eric Leenders, a director at the British Bankers’ friendship “But there comes a point where you have to speak commercially what’s the most sensible thing to doprevious month, the OFT said it would examine the penalty fees that banks charge customers who go overdrawnThe regulator has asked banks to justify the level of punishment fees charged on overdrafts and mortgages and will spend the next few months on a factfinding work out with the British Bankers’ Association and the Financial Services power, the City watchdog, before deciding whether to open a more detailed investigationThe move follows its investigation earlier this day into credit card penalties which, it finished, were “unfair” to customers This has resulted in 36 credit card issuers cutting punishment fees to £12 from an average of £2268The OFT supposed in April that the same principles should be relevant to overdrafts The declaration rang alarm bells for banks, which are concerned that their profits would be injured if overdraft fees fell Some signalled it could spell the end of gratis banking, whereby bank customers are not emotional if they remain in creditRetribution by the ombudsman is determined after customers’ banking histories are examined and negotiations take place with banks“If a customer has salaried three previous overdraft charges and writes a fourth cheque against the account, it might be the case that we decide they should believe some responsibility for their actions,” Mr Creswell explainedIn most cases, banks have agreed to repay from 50 to 100 per cent of the disputed charges punishment charges for unauthorised overdrafts can be as high as £30 a day Which, the customer group, estimated that penalty charges cost customers £47bn a dayComplaints by consumers against banks are continuing to rise The Banking Code Standards plank, which operates a voluntary system of conduct for the industry, said it had received 2,242 complaints and queries in the day end March 31 2006, compared with 1,812 the previous yearRSS news feeds = requires subscription to FTcom* smallest amount delay 15 minutesAll times are London timeFT HomeSite mapContact usHelpAdvertise with the FTPress enquiriesStudent offersFT ConferencesFT Research CentreCorporate subscriptionsFT Group© patent The monetary Times Ltd 2006 "FT" and "monetary Times" are trademarks.

Online bankers feel in control - Published:09/11/06

According to a learn carried out by Alliance and Leicester, 44 per cent of Brits who perform all their banking online sense they have their finances in orderOnline banking has increased by 63 per cent since 2003 and it is thought that the UK's online monetary population is now in excess of 14 millionBanking online allows customers greater right of entry to their financial details Of those with an online bank explanation, 44 per cent use internet banking two times a weekThis is in stark contrast to those still using countenance to countenance banking, of whom just three per cent call a branch two times a week"Logging on to your internet banking account gives you immediate, 24-hour access to the up to date rank of your finances," supposed Helen Palmer, manager of Alliance and Leicester current accounts"As such, you can make sure your account at the clack of a button, and manage your money more effectively"You can keep track of your in and out-goings which means you have a clearer idea of where you rise and so can easily avoid going into the crimson by mistakeChecking bank balances was the most well-liked reason for online banking, with 96 per cent proverb that online products were the best current financial records for staying in controlMoneyExpert Limited is authorised and regulated by the Financial Services power (FSA Registration No 301654) The Financial Services power does not regulate some forms of mortgage agreement, credit cards, personal loans, current accounts.

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Fed concern at sub-prime insurers by Finance News Bulletin

Published: 10/04/08

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Lloyds TSB: Brits unconcerned by cyber-crime - Published:14/09/07

Ombudsman gets tough on banks over unfair charges - Published:03/09/07

Online bankers feel in control - Published:09/11/06