Barnsley B. Soc. to be part of Yorks

JayTee99_2

Well here we go again, another week another merger..
got funds in YBS, found them to be absolutely superb, particularly their online account.
I was going to add to those funds next week, but having second thoughts now. Not intending to withdraw any, but unlikely i will transfer any more in.

This from the ybs site:-

http://www.ybs.co.uk/barnsley/faq.jsp

5. Has the Barnsley got any other anticipated losses?
The Barnsley’s board believe that there are no other anticipated losses. Their underlying business is in extremely good health and it has a very high quality mortgage portfolio and a strong retail funding base.

Yeah, right... with assurances like that, i'm REALLY impressed!

alanq

Reaper wrote: »

It strikes me as odd that a building society could think of nothing better to do with their short terms funds than stick it in a savings account with a rival.

Chelsea B.S. was also caught out by the collapse of Icelandic banks. It explained that it was required to keep large sums of money in liquid assets and had spread them among 100 banks. Barnsley B.S. no doubt was doing similarly on a smaller scale.

http://www.thechelsea.co.uk/media/media_press_release_20081010.html

bristolleedsfan

alanq wrote: »

Chelsea B.S. was also caught out by the collapse of Icelandic banks. It explained that it was required to keep large sums of money in liquid assets and had spread them among 100 banks. Barnsley B.S. no doubt was doing similarly on a smaller scale.

So are you saying that Barnsley BS had/have "up to £10m" spread among "100 banks":question:

qamwc1

BBS had reserves i.e. the annual profits which they had retained in the Society of about £22m. So this is about £350 per member. They (may) have lost £10m so that means the reserves per member become about £200. YBS has reserves of about £1bn and membership of about 1.67m. So that is about £600 per member.

When the merger (YBS is not buying BBS) takes place the BBS members will be equal members with YBS members of the "enlarged" society. So if anything, YBS is being generous by diluting some of its financial strength to protect BBS.

I'm surprised for a small society that had as much as £10m in (it appears) only two banks. Their cash should have been spread much more thinly.

When your society might be financial trouble do you want the FSA to consult you or make sure your money is safe. Membership rights have always been restricted - the directors (where the power lies) are rarely selected by members. You are given a name you have to rubber stamped - the regulators don't really want amateurs running building societies.

Count_Dante

qamwc1 wrote: »

BBS had reserves i.e. the annual profits which they had retained in the Society of about £22m. So this is about £350 per member. They (may) have lost £10m so that means the reserves per member become about £200. YBS has reserves of about £1bn and membership of about 1.67m. So that is about £600 per member.

When the merger (YBS is not buying BBS) takes place the BBS members will be equal members with YBS members of the "enlarged" society. So if anything, YBS is being generous by diluting some of its financial strength to protect BBS.

I'm surprised for a small society that had as much as £10m in (it appears) only two banks. Their cash should have been spread much more thinly.

When your society might be financial trouble do you want the FSA to consult you or make sure your money is safe. Membership rights have always been restricted - the directors (where the power lies) are rarely selected by members. You are given a name you have to rubber stamped - the regulators don't really want amateurs running building societies.

Indeed. Members vote 'no', Bsc goes belly up, members whine, taxpayer picks up pieces.

baby_boomer

Are you suggesting that Barsnley BS directors have been lying to members over the strength and good health of the society?

It's only £10m after all, temporarily mislaid.

This atmosphere of fear provides an excellent cover for a bit of cheap consolidation for the big boys.

Count_Dante wrote: »

Indeed. Members vote 'no', Bsc goes belly up, members whine, taxpayer picks up pieces.

What about, Members meet board and put some steel into the Barnsley directors so that Yorkshire BS at least guarantees a bonus should the £10m be recovered?

qamwc1

Small societies have always been swallowed up by larger societies - there are now 59 but in 1910 there were 1723. Societies don't need the current climate as a cheap consolidation. YBS remains a mutual society - there is no reason for me to believe that the YBS directors (or their members) are aggressive otherwise would they have not joined the queue to convert to plcs by offering their members free shares? And (oh dear) look at the ones that converted - Alliance & Leicester, Halifax, B&B, Northern Rock. The others (Abbey, C&G) got bought up before this mess.

Before the share owning democracy business started, societies did not pay bonuses to their members when merged. This was introduced as part of policy to encourage (some would say bribe) members into vote into existence these wannabe banks (the way bonuses/share allocations were worked had little to do with a members participation in that society) - the government changed the law for all this to happen. This all happened back in 1986.

If one thing that has been learnt now is that the traditional model is what is needed to protect savers - the game has changed.

I wouldn't lay this at the door of the directors only. Building societies have auditors - they are pretty powerful and have a duty to whistleblow if members funds are at risk. There is also the FSA who would get regular information from the Society. The problem is whether, especially the FSA, was up to the task. Like many government things, underfunded with low salaries - no votes in it before?!

bristolleedsfan

qamwc1 wrote: »

Building societies have auditors - they are pretty powerful and have a duty to whistleblow if members funds are at risk. There is also the FSA who would get regular information from the Society. The problem is whether, especially the FSA, was up to the task. Like many government things, underfunded with low salaries - no votes in it before?!

Seems in the case of Cheshire, Derbyshire, and Barnsley, those whom you have named have exercised their "power" and shown evidence that they are "up to the task" in ensuring that in all three cases the 2008 accounts wont be published. :rolleyes:

baby_boomer

bristolleedsfan wrote: »

So are you [alanq] saying that Barnsley BS had/have "up to £10m" spread among "100 banks":question:

I suppose the Barnsley would have had about £100m in liquid assets to manage. So it might have been with 20 banks in £5m lots.

Cozworth806

Have an account in both, again not surprised given the DBS/CBS situation that there is no immediate payout, but the online account that I started with Barnsley was paying a pretty good rate so the money will stay there until its settled one way or another, and then will reconsider.
Given the Tesco Internet saver offer I may well move some money to that, no windfall, unless they get some dodgy apples.