Birmingham Midshires Error on Fixed Rate Bond Interest Calculation

earlgrey_3

ad44downey wrote: »

HBOS and their subsidiaries are incompetent and clueless. You've got to expect this sort of thing if you save with them. Just look at their share price, it don't tell no lies

And what's the share price got to do with customer service? Santander has been one of the most resilient in the sector while at the same time Abbey attracts more complaints than any other UK bank. Unfortunately there is no correlation between customer service and the performance of a bank's shares.

backfoot

earlgrey wrote: »

And what's the share price got to do with customer service? Santander has been one of the most resilient in the sector while at the same time Abbey attracts more complaints than any other UK bank. Unfortunately there is no correlation between customer service and the performance of a bank's shares.

Admittedly it would be nigh on impossible to prove a correlation,on an event by event basis, but I wouldn't accept that there wasn't a link. Every organisation/quoted company that I have worked in go to great lengths to stress customer service is a top priority.Indeed in it's simplest sense,if you hacked of all your customers,then you wouldn't do any business and obviously your business would fail. (Not the best link to banks but the analogy of Ratner shows how this can work).

Why for years and years did Marks and Spencer rule the high street and have a long running high share price.Precisely because of the excellent Customer Service and value brand that they generated.

If I take my own examples,I am now unlikely to use Nationwide ever again and as a result they will lose the gross profit margin they would have earned through my business.Ok just my savings will not register but the accumulation of many disgruntled customers would affect profit and consequently the share price.

If Customer Service isn't important,why are there so many surveys and awards for it?

Don't quite understand your point about Santander? They absorbed the ailing and rubbish Abbey and now might not be so clean themselves with some of the Madoff fallout.

slickrock

I would bypass the savings team, either by post or telephone, and directly telephone the Customer Relations team on 0845 603 6582. Maybe insist on speaking to somebody from the Office of the Managing Director - a member of this dept. sorted my problem out.

Possibly avoid using the 'Office of the MD' link on this page (http://www.askbm.co.uk/aboutbm/contact/complaints.asp) to send a message - I have yet to get a reply re backdating of the interest correction.

oldish

Our own experience with BM showed them to unbelievably incompetent with no communication between different departments. A change to a new account within the organisation failed to effect the transfer of money. The fault was admitted in the end and the better rate backdated. Even then they mixed up the two account numbers...

slickrock

savetilibleed wrote: »

I'll be interested to know how the interest is actually, or should be calculated, as we will be getting out first full month of interest for December, paid early in January. Do you have a spreadsheet that will calculate it - or can you tell us how? My understanding is that the interest is calculated daily so on a fixed interest and unchanging balance it ought to be fairly straightforward. Would it be say for a full December :- £££ x interest (as decimal) x 31/365 ?

OK, here goes. Firstly this is how they calculated it incorrectly. I use £1000 invested for simplicity - in reality I may not have bothered complaining for the sake of a quid . Rate was 6.91% for 11 months:

£1000 x 0.0691 x (329/365) = £62.28

This is how the correction was calculated for 6 days missing interest:

£1000x 0.0691 x (6/365) = £1.14

Total days = 335. Their internet banking confirmed account opened on 25/09/07, maturing 25/08/08, so 335 days is correct. The spreadsheet extract I received after my initial complaint had interest rate of 6.86%, start date of 29/09/07. The second extract had the correct rate, but now with a start date of 01/10/07 !!

I have found two pieces of small print re delay between cheque received and interest earnt:

General Investment Terms and Conditions, A. Interest and Charges, Section 4 ... "For cheques, interest will be payable from the second banking day following receipt except for fixed term accounts where interest is calculated from the first banking day."

The above does not have a date on it. The second version I have is dated 01/06/08, and I believe that it came after the one above (happy to be corrected on this though):

General Investment Terms and Conditions, A. Interest and Charges, Section 4 ... "For cheques, interest will be payable from the second banking day following receipt."

No mention of fixed term accounts now.

Hope this helps.

muffinhead

I've found BM to be incompetent too. I signed up for their Fixed Monthly Income Bond a few months ago but when I was due to receive my first lot of interest nothing came through. I contacted them to be told that I had signed up to the Annual Maturity bond via telephone. Only problem was, I signed up via the website and can pretty much guarantee I signed up for the monthly bond (I double check all forms I fill out).

All the paperwork they sent through detailed both monthly and annual figures and t&c's so I naively assumed I was on the monthly bond. I've decided not to pursue the matter as the monthly income is not essential but I just hope on maturity they pay the correct amount of interest.

savetilibleed

Thanks for the info, slickrock.

I wonder, if they got yours wrong how many other's were also wrong but didn't know?

Actually I forgot I did get a few days interest from my Saga FR Bond (I get paid monthly interest).

Edited for errors from this point see post timed at 5.20pm

It was opened on 26/11/08 and I got £9.90 interest at 5.31% net.
£17000 x 0.0531 x (4/365)= £9.89.

[strike]
So seems mine earned interest from the second day after the account was opened, 27/11 ie 4 days, so they seem to have applied the first part of the first T&C you quoted, ignoring the fact it is a fixed term account. ie. "For cheques, interest will be payable from the second banking day....." or did they apply the other T&C you quoted.."For cheques, interest will be payable from the second banking day following receipt." Think they must have applied the latter

If the first quoted T&C, then mine is wrong by 2 days which equates to £4.94 more.
[/strike]

slickrock

savetilibleed

Try the customer relations number I posted earlier. It was answered quickly earlier today and the person I dealt with works in the office of the MD and even if he does not know the answer immediately, he does seem to find out and get back to you.

savetilibleed

Oh I can't believe it - I have my own information wrong!

I'll edit the post to refer to this. Damn! :mad: and other emotions!

On checking (should have done before I replied and not from memory) the account was opened on 26/11. The General T&C's I have say as you quote "For cheques, interest will be payable from the second banking day following receipt". Whereas the letter I first got, specific to the account, after which I sent my deposit, says "Interest will be payable from the date of account opening."

In the General T&C's it says where there is any conflict in the terms, the terms special to an account will take precedence.

So because the interest I received was 4 days it was earned from and including 27/11. So neither seems right still, but as it is only a day and a couple quid I won't worry.