NI Presbyterian mutual society, Short of funds for withdrawal?

OldJohn

Hi All - I have been somewhat alarmed at the speed with which some of the Legal profession have managed to extract money from PMS shareholders. Nothing like kicking a person when they are down!! It seems that this was sparked by some assumptions. Remember Assume = !!! U Me! Ah well with the recession it will bring an extra few thousand into their coffers. I know information is hard to get from anyone at present but what we need are hard facts - the letter which we received on Sat. morning from the Administrator, I would rather have had on Tuesday, maybe then I could have enjoyed the long week end better. But at least it was some factual information. It tells me that the problem is still being worked on - good, it says he is still looking at where the blame lies - good. We have only our perception of what is involved, it would probably make the mind boggle if it was all laid out before us. It says to me, all is not lost - and my rose tinted spectacles are still off.
Regarding asking for borrowers to refinance - I have a small loan and have received no such letter! - I understand that this was for borrowers who had defaulted on their loan - hadn't paid - in arrears etc. - the ones who were given money (sorry borrowed) from the He who loaned money Secretary and had little or no intention of ever repaying it. So a letter saying pay up or else seems well overdue. I have no doubt some will even make a token offer to settle (standard practice in dealing with credit card companys and banks I'm reliably informed) but the Administartor if made such offers will hopefully decline as unlike profit making banks - the PMS has no such profits to allow this.
Finally may I again express my deep sorrow for the Shareholders who are in dire straits financially, none of my waffle can bring them financial assistance but you are constantly in my prayers and thoughts.

red_bertie

Old John, does this mean if they haven't paid back their monthly mortgage repayments [deemed to have defaulted] that people's homes wil be repossessed and auctioned off for money to the central fund? I am not passing judgement, just asking the question.

OldJohn

Red Bertie, My understanding is that when I took out my loan, I agreed to terms, like any financial contract, if I default, I am required to pay back the sum borrowed plus any interest due up to the date paid. So I presume whatever was given as security will be required. I would imagine the 21days is to give defaulters time to seek finance and respond to the administrator - probably more lenient than a bank or credit card company. I'm sure this just adds to the Administrators workload, but his remit is to recoup as much as he can (if not all) for the Shareholders. I have some savings that I had planned to use to pay my interest payments as they fell due but like many have no access to these funds. So I have to grit my teeth and pay any interest owed as it becomes due, don't like it, get annoyed thinking about it but, if all goes well i'll get my savings back - eventually. I don't believe they are gone forever. If I fail to make my payments when due I become a defaulter and would imagine I would get one of the letters referred to previously.

Whatnow?_3

OldJohn wrote: »

I have some savings that I had planned to use to pay my interest payments as they fell due but like many have no access to these funds. So I have to grit my teeth and pay any interest owed as it becomes due, don't like it, get annoyed thinking about it but, if all goes well i'll get my savings back - eventually.

This is a very difficult situation you find yourself in, Old John.
I am sure that there are many like you too.
The sooner this is sorted to everyone's satisfaction the better.

Money_Grabber13579

The thing is, the government has absolutely no reason to pay out to savers of PMS, and rightly so. PMS did not subscribe to the banking code, wasn't regulated by the FSA and didn't pay to be part of the protection scheme. All the other banks that were bailed out, did do all of these things, so they got bailed out.

If the PMS didn't pay to be protected, why should they be compensated? If your house burnt down and you had no insurance, you wouldn't expect any insurance company to chip in and give you compensation either.

In this case, you can't have your cake and eat it at the same time.

Now while this may seem harsh on the people who saved within it, it is up to the Presbyterian Church to get them out of the mess. It's all very well for the church to be linked with the PMS in the good times, but then they can't just cut the strings during a time like this. Moral of the story: PMS was a risky venture because the directors didn't have any safeguards to prevent something like this happening, and the savers weren't properly informed. In my view, the directors have to shoulder the entire blame for what has happened. Why should the all the other banks have to pay to bail out another "non-bank" which didn't even belong to their association? It wouldn't be a fair deal.

OldJohn

[QUOTE=Money_Grabber13579

In this case, you can't have your cake and eat it at the same time.

There are a number of previous posts which are also a reply to these comments, a handout is not required, a loan would be most welcome.
Most people did not know that there was a £35000 guarantee but when the £50000 guarantee was promoted by HM Government, people panicked and if they had not removed their funds from the PMS this forum thread would not exist and there would have been a 6% dividend for savers with the PMS instead of 0% and locked in funds. This is why there is a call for HM Government to assist. Unlike others they have helped, the funds will not be distributed for bonuses etc!
Hindsight is a wonderful thing, certainly there is blame to be apportioned and as the Administrator has stated in his letter, he is still investigating - but his priority is (rightly so) to focus on getting funds back into the Society to pay out to those to whom they belong.

Money_Grabber13579

A number of people have also been calling for a bailout however. Anyhow, in this case, a loan would be a bailout because realisitcally, there is no chance of it ever starting up again to recoup the losses.

It's collapse was caused by panic, there I agree. But then, so were all the other bank collapses.

While I don't agree with the taxpayer bailing out the PMS, since they didn't pay their insurance so to speak, I do feel sorry for the savers themselves. It seems to me, that some of them were "pressured" into investing in PMS as it was a safe place to put their money and it was part of the church. Then when it goes bankrupt, the church just walks away. This is a wholly internal matter, and I feel it is up to the church and directors of PMS to sort it out.

crazymess

One serious issue is still not resolved here -

PMS was not a bank, not a building society - it was an INDUSTRIAL AND PROVIDENT SOCIETY - and it seems that the powers that be either in Westminister or Stormont - allowed a LARGE MONEY LENDING AND TAKING BUSINESS IN NORTHERN IRELAND TO OPERATE WITHOUT REGULATION. Somebody somewhere - did not complete the Industrial and Prov Societies Order 2006 - they did implement Articles 1 and 2 - and I'm afraid the rest of the articles - to put us in line with the rest of the UK - were not done!!!

Did the DETI implement a system that will allow them to register an unregulated money lending operation but have absolutely no accountability for any subsequent regulation beyond filing annual accounts?

When Gordon Brown et al - increased the guarantee from £35k to £50k this did not take into account - small saving institutions like the PMS - surely they must have realised there would be a knock-on effect.

Perhaps the answers lies here - THIS IS A UNIQUE SITUATION AND AS SUCH THE SAVERS SHOULD BE HELPED WITHOUT DELAY.

brick

_ wrote: »

If the PMS didn't pay to be protected, why should they be compensated? If your house burnt down and you had no insurance, you would[n't -typo corrected] expect any insurance company to chip in and give you compensation either.
Why should the all the other banks have to pay to bail out another "non-bank" which didn't even belong to their association?

Is there an implication here that the monetary "insurance premiums" paid by financial institutions (to the "insurer") covers or exceeds HMG's cash injections and exposure?

My, admittedly not detailed, reading of the press coverage was that HMG would be taxing citizens heavily in order to underpin its recent flurry of huge commitments to (among others) those favoured financial institutions which it has elected to support.
If so, does this suggest that the collective premiums paid by financial institutions perhaps don't come anywhere near the amount which HMG is actually injecting?

Can anyone point to actual facts and figures?... which contrasts "premiums paid" with HMG's actual exposure?

I have no idea how much the favoured financial institutions, both individually and collectively, have actually paid.

I do know there is a cap/limit on my house insurer's liability, and if rebuilding costs exceeded that amount I would pay the extra... and not the insurer.

sickasaparrot

Extracts from a letter I received from Lord Trimble regarding the regulation of PMS.



“If the persons responsible for a body were negligent in failing to register, should the innocent investor be penalised. The answer ought to be "no".

“The regulatory scheme was devised by the government. It considered it necessary to tie together the Registrar of Friendly Societies and the FSA so far as England was concerned and it failed to achieve that object concerning Northern Ireland. So we should continue to press government to meet the losses that have resulted from its faulty regulatory structure”.