MSE News: Big five banks should sell branches, says Ed Miliband

opinions4u

pqrdef wrote: »

You mean, rescuing what could be saved from the car crash created by the Tories allowing demutualisation of building societies?

List of ten. Seven demutualised after Labour came to power.


http://www.bsa.org.uk/consumer/factsheets/100010.htm

JuicyJesus

opinions4u wrote: »

List of ten. Seven demutualised after Labour came to power.


http://www.bsa.org.uk/consumer/factsheets/100010.htm

But the Tories changed the rules to allow it. If you're arguing that Labour should have disallowed it again, fair comment, but the Tories *did* allow the demutualisation of building societies, regardless of the government it actually happened under

opinions4u

JuicyJesus wrote: »

But the Tories changed the rules to allow it. If you're arguing that Labour should have disallowed it again, fair comment, but the Tories *did* allow the demutualisation of building societies, regardless of the government it actually happened under

The 1986 Building Societies Act does have a lot to answer for.

But in the end the regulation of the last 15 years has been shocking.

Form filling rear covering nonsense that achieved nothing. And they completely failed to prevent the high risk loan portfolios of RBS and BOS expanding.

The Chancellor of the time was quite happy watching profits grow and stamp duty revenues rise. It suited him to turn a blind eye to the excesses. It was funding his spending spree.

Banks, government, regulator. All terrible.

Paul_Herring

opinions4u wrote: »

The Chancellor of the time was quite happy watching profits grow and stamp duty revenues rise. It suited him to turn a blind eye [...]

I do hope that wasn't intentional...

oldvicar

opinions4u wrote: »

The Chancellor of the time was quite happy .....

It suited him to turn a blind eye to the excesses. It was funding his spending spree.

:rotfl:

I don't think you meant to be funny about the former chancellor's impairment. But maybe it explains how this could happen.:D

pqrdef

opinions4u wrote: »

Banks, government, regulator. All terrible.

Building societies, less so.

The banks were set on the road to ruin by the Big Bang. Ironically, whereas demutualised building societies might have survived in the pre-Big Bang world, they were never likely to make it in the new era.

But my point was, the retail landscape would look very different today if those 10 names you listed (plus Leeds Permanent) were still around as building societies.

opinions4u

pqrdef wrote: »

Building societies, less so.

The difficulty for building societies was / is one of size.

For me, the country was a better place when it had 600+ building societies 25 years or so ago.

But, as you suggest, the regulatory framework favours the big. Layer after layer of rules and regulations that cost the same to implement, regardless of size, or offer clear economies of scale to the big boys have meant that only the strong (or rather big) can survive.

The only way for the small to survive is to provide nice services for which there is a demand or to go after more profitable lending to grow the balance sheet. The latter has tripped up the majority of smaller building societies as the higher risk profile has left them seeking out a bigger owner as soon as the brown stuff inevitably hits the fan.

The banks were set on the road to ruin by the Big Bang. Ironically, whereas demutualised building societies might have survived in the pre-Big Bang world, they were never likely to make it in the new era.

Absolutely true.

But my point was, the retail landscape would look very different today if those 10 names you listed (plus Leeds Permanent) were still around as building societies.

Not just different. Better,

oldvicar wrote: »

I don't think you meant to be funny about the former chancellor's impairment. But maybe it explains how this could happen.:D

Oops. No, I didn't mean it on that level!