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Banks MUST hold more capital, and lending won't get "back to normal" until then
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Forbearance doesn't have a set definition - I think the FSA struggled because it has different meanings at different banks i.e. converting to IO, payment holidays extended payment periods are all examples of forbearance so it makes the data more difficult to collate and understand. It also means that they are not all non-performing.
1.7% is the arrears rate that FSA said that they'd expect in the absence of forbearance vs. the real 1.2% arrears rate typical at the time. EDIT: I think it's 1.7% of mortgages in arrears rather than £/ pence.
In terms of forbearance they estimated 5% - 8% of all mortgages were subject to forbearance to some degree.
The next question is how many are on the threshold of forbearance with deteriorating positions.:eek:"If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
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Has Merv been reading the forums?"First, monetary policy supports demand and output by encouraging households and businesses to switch demand from tomorrow to today. But when tomorrow becomes today, an even larger stimulus is required to bring forward more spending from the future. Since the paradox of policy has been evident for almost four years, tomorrow has become not just today but yesterday. When the factors leading to a downturn are long-lasting, only continual injections of stimulus will suffice to sustain the level of real activity.
Obviously, this cannot continue indefinitely. Policy can only smooth, not prevent, the ultimate adjustment At some point the paradox of policy must be resolved."0 -
Graham_Devon wrote: »Has Merv been reading the forums?
Wonder why it took him and his erstwhile economists and analysts to cotton on?"If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
In light of the proposed FSA mortgage reforms i.e. interest only prohibited, age restrictions etc, is it not now the case that Buy-to-Let borrowers will have a huge purchasing power advantage over home buyers? Property investors have been exempted from mortgage reforms after all.
I've been of the view that there'll be a substantial yet politicly ignored, struggling renter class emerging over the next decade or so, and can only see these restrictions amplifying the divide.Hi, we’ve had to remove your signature. If you’re not sure why please read the forum rules or email the forum team if you’re still unsure - MSE ForumTeam0 -
Turnbull2000 wrote: »is it not now the case that Buy-to-Let borrowers will have a huge purchasing power advantage over home buyers?
A 20% deposit seems a major disadvantage to me. Plus the interest rate differential on new business.0 -
it only took rbs 4 years to repay 161 billion in sls. how much extra time will they need to meet the capital requirements? not long i bet.0
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it only took rbs 4 years to repay 161 billion in sls. how much extra time will they need to meet the capital requirements? not long i bet.
In the meantime shrunk their balance sheet by a third or around £700 billion. that was before sale of Direct Line or the EU branch directive.
A mere shadow of its former self.0 -
Graham_Devon wrote: »Has Merv been reading the forums?"First, monetary policy supports demand and output by encouraging households and businesses to switch demand from tomorrow to today. But when tomorrow becomes today, an even larger stimulus is required to bring forward more spending from the future. Since the paradox of policy has been evident for almost four years, tomorrow has become not just today but yesterday. When the factors leading to a downturn are long-lasting, only continual injections of stimulus will suffice to sustain the level of real activity.
Obviously, this cannot continue indefinitely. Policy can only smooth, not prevent, the ultimate adjustment At some point the paradox of policy must be resolved."
No. No everyone's posts. Just some.
That's why he doesn't seem to know what day it is.0 -
it only took rbs 4 years to repay 161 billion in sls. how much extra time will they need to meet the capital requirements? not long i bet.
Shrunk the book shrunk their assets."If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0
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