Bad News for Banks....

Generali

PaulF81 wrote: »

There may be more savers than borrowers, there certainly ain't anywhere near as much savings than borrowings.

Not true.

By definition, assets = liabilities on the balance sheet.

As banks must hold assets equal to a certain percentage of liabilities (reserves) they will always have a positive equity value. Even NRK had a positive value when nationalized. It was cash flow that screwed them.

JohnyBM

grizzly1911 wrote: »

Who cares about savers?

Governments who want people to vote for them.

Remember there are more savers than borrowers.

grizzly1911

JohnyBM wrote: »

Governments who want people to vote for them.

Remember there are more savers than borrowers.

But government don't set interest rates, do they? So it isn't their fault;)

Pobby

lemonjelly wrote: »

There's a debate on another board that the banks are "awash with cash" & as a result are less likely to offer decent rates to savers. Many savers have been expressing discontent at the rates on offer at the moment (less than 4% for 3+ years is the norm - not even close to matching inflation after tax...).

Is this news likely to offer savers some hope? Are institutions likely to increase their rates to increase the capital they hold?

Or, is the low rates being offered a contrast to Merv's allegations?

Really cannot see interest rates increasing. Banks are having a field day. Lots of tax payers money. Very little regulation as how they spend it. If we are to believe that we are so deeply in problems of debt ( I think that is the case ) , then a small increase could bring the whole lot crashing down.

20 odd years had a mortgage of £58k . For a long time it was about 5 to 6 hundred a month to pay back. Imagine that on a £100k mortgage these days.