Looks like West Brom Building Society is going UNDER

Steve_xx

withnell wrote: »

But that's not the situation - the funds are required to balance the books.

The mortgages are already sold, and as existing wholesale funding deposits come to an end they need the newly deposited cash to pay these back

Yes I see your point.

Steve_xx

hotkee wrote: »

A bit of humour -

On the Wednesday I sent an application to West Brom for a new second bond which takes my total to the 50k limit. :-)

You've made a bit of an error there. Why did you not put say £47,750 in and then if the worse came to the worse the cumulative interest wouldn't take you over the magic 50k limit?

opinions4u

withnell wrote: »

If everyone piles in 50k, then it'll probably be enough to prop the society up, as the only reason they have problems is finding wholesale funding - so everyone take advantage of a decent rate, and help a British institution!

Yup. Withdraw it from another British instituion and let them go under instead!

Nice idea, but there is not enough liquid savings in the market place to keep on doing this.

hotkee

Steve_xx wrote: »

You've made a bit of an error there. Why did you not put say £47,750 in and then if the worse came to the worse the cumulative interest wouldn't take you over the magic 50k limit?

Yeah thought about that but I am gonna be GREEDY - hedging my bets to be honest. If they go under, I am covered and interest will be paid to me as per the Icelandic collpase. And I want my mind to work in whole numbers :-)

PS I was not into icelandic banks (thankfully)

asbokid

hotkee wrote: »

Yeah thought about that but I am gonna be GREEDY - hedging my bets to be honest. If they go under, I am covered and interest will be paid to me as per the Icelandic collpase. And I want my mind to work in whole numbers :-)

brave or foolhardy.. it's a fine line.. in september, the FSA is scheduled to review the FSCS compensation scheme. The £50k ceiling for compensation on retail deposits is up for review, as are the rules concerning the combined savings from mergers.

One of the big questions up for debate is whether a saver is entitled to £100k compensation if he saves £50k with bank A and another £50k with bank B, and bank A then buys bank B, but bank A then collapses...

Terrytraveller

Monthly interest option is available on £50k and fully covered by the FSA should the society default on the £50k repayment at the end of the bond term.
So I have taken the monthly option which will give me around £175 monthly income. If they default on repayment at the end of term, then surely I should get back the entire £50k, not the £50K less the interest payments taken?
Comments appreciated..........Regards Terry

asbokid

Terrytraveller wrote: »

Monthly interest option is available on £50k and fully covered by the FSA should the society default on the £50k repayment at the end of the bond term.
So I have taken the monthly option which will give me around £175 monthly income. If they default on repayment at the end of term, then surely I should get back the entire £50k, not the £50K less the interest payments taken?
Comments appreciated..........Regards Terry

Which, the consumer "charity", is publicly condemning the West Brom for launching a bond with a minimum deposit that is the FSCS compensation ceiling of £50k..

We might question Which's motive for rounding on the West Brom. What is it up to?

Is it out to help some buddies in the financial sector who are desperate to accelerate the consolidation of the industry? To steal the headlines for itself? To grandstand, and to underline the Consumer Council's activities in these worrying times? No coincidentally, this all serves to boost Which's membership subscriptions...

withnell

Terrytraveller wrote: »

Monthly interest option is available on £50k and fully covered by the FSA should the society default on the £50k repayment at the end of the bond term.
So I have taken the monthly option which will give me around £175 monthly income. If they default on repayment at the end of term, then surely I should get back the entire £50k, not the £50K less the interest payments taken?
Comments appreciated..........Regards Terry

You'll get back whatever they owe you up to a limit of 50k - so capital plus accrued, unpaid interest. If you invest 50k, then you will get 50k, just lose the interest not yet paid out

miserable_ol_so_n_so

When will the bright sparks who ruin er run our financial systems come up with the idea to give a commitment to repay the original investment plus all accrued interest until the day the compensation is actually paid....that way....no one will have any motive to move funds around.......

baby_boomer

Telegraph

"...West Bromwich.... has opened its data room to bidders..."

Let's hope it's not too much of a Chamber of Horrors . Although the Telegraph article doesn't have much confidence.

WaltD wrote: »

The whole of the front page of today's Birmingham Post is taken up with a lengthy statement by West Brom Building Society management, insisting that the Society is .... set to continue for many more years as an independent mutual.

Now where have I heard something like that before .... ?

Nice one Walt

Now where exactly are those West Brom annual results?

As we've all noticed before with Cheshire, Derbyshire, Barnsley, Scarborough, Dunfermline etc. it's useful to have a merger or be bailed out by the government just before the results are due because it means the management doesn't have to publish them or ever be held to account by members for them.