Northern Rock Crisis Article Discussion

dougs

baby_boomer wrote:

Why do you ask who has paid money back into NR? It was the wrong thing to do and remains the wrong thing to have done.

dougs wrote: »

thanks for clarifying your question. However I'm still unsure as to why you think it is such a wrong thing to do, with the govt. guarantee in place. Some people may want to return money to NR whilst the guarantee is in place, as it means their money is as secure as it could be, and be concerned that you have information that could/should worry them about doing that. So if you have any concrete reasons for it being such a bad idea it would be really helpful to people if you could voice them. Thanks.

can I take it, by your lack of response to my question, that you have no clear information on why this is the wrong thing to do but that it is just your opinion? Sorry to sound pedantic but I am only trying to find out if you know something more than the media would have us believe. Thanks

Fat_Girl_Slim

In a recent newspaper article on 'who owns who' Legal & General was shown as being owned by Northern Rock. If Northern Rock saving are now covered 100% - i.e. beyond the FSCS £35,000 limit - does the same apply to Legal & General customers?

baby_boomer

Fair enough. And it is opinion.

As has been pointed out above, the government guarantee only lasts during "current market instability" or similar phrase.

The government can't announce that the guarantee is over without unleashing another run on NR.

BTW it is now guestimated by one merchant bank that the government has lent over £7bn to NR.

So the government will be looking for a quick fire sale to dampen remove the issue from the political agenda & take it off the BofE's balance sheet - you don't know which opportunistic money-grubbing bank will be your new deposit taker instead of NR.

Surely the sensible thing to have done was to have taken the opportunity to have deposited your money elsewhere at the top market rates, since many/ most? will have had to have gone through the account re-opening process anyway?

The guarantee is a pointless reason to go back into NR unless you believe that other banks and building societies are at risk. I don't believe that, but if you do then moving money back into NR wiill seem logical to you. To me it's seems like a wasted opportunity to get a better interest rate and move your money to a better long term location.

And if you've got more than £35K with NR, you're going to want to spread your money around in due course once NR is taken over by Big Bad Bank Plc anyway.

bristolleedsfan

dougs wrote: »

can I take it, by your lack of response to my question, that you have no clear information on why this is the wrong thing to do but that it is just your opinion? Sorry to sound pedantic but I am only trying to find out if you know something more than the media would have us believe. Thanks

"It was the wrong thing to do and remains the wrong thing to have done"

because no savers were ever or will ever lose any of their savings held in northern rock, queues formed cos of media hype, up until two years ago nobody would have even known if a bank had asked the BOE for a emergency funding facility.

dougs

baby_boomer wrote: »

The guarantee is a pointless reason to go back into NR unless you believe that other banks and building societies are at risk. I don't believe that, but if you do then moving money back into NR wiill seem logical to you. To me it's seems like a wasted opportunity to get a better interest rate and move your money to a better long term location.

thankyou for explaining. There is of course the 'loophole' of the reimbursement of transfer fees and the lost interest whilst money was away promise which may attract some people to put money back at least temporarily. This could mean that effectively your money was earning interest twice for the period between 13th September and 5th October if you moved it back to NR by that date.

This is from an email I received from NR "...........Any charges you paid will be automatically refunded to that account. This includes interest penalty charges or CHAPS (telegraphic transfer) fees. Please note you must reinvest before 5 October 2007 to benefit from this. In addition, you will be paid interest as normal on your Account for the period that the money was withdrawn.........."

JayTee99_2

As the dust began to settle, it was obvious to me that NR had been severely damaged by this debacle. It seems unlikely to me that they can just pick up from where they left off. But that's just my opinion.

Not closed any accounts. Left the ISA alone, but now transferred most of the money away from the main account. I had been intending to spread it more thinly; this crisis gave me the incentive to do so.

Opened up several new accounts with Banks/Bulding Societies. Some are already fully operational, one is almost there.
But there is one that hasn't even had the decency to email/write to me, acknowledging my application, despite a couple of phone calls. I won't name them - Yet... they may come good (not seen them mentioned on here these past two weeks).

No doubt these transfers have cost me money, but no matter, this was a 'wake up call' for me to take some action. I don't feel happy exceeding the present protected limits for savings (not even with NR ).

and yep, still got the original shares from flotation .... Oh dear!

rebeccaj

JayTee99 wrote: »

But there is one that hasn't even had the decency to email/write to me, acknowledging my application, despite a couple of phone calls. I won't name them - Yet... they may come good (not seen them mentioned on here these past two weeks).

wouldn't be Abbey by any chance, would it? I'm currently beginning to wish I hadn't bothered opening (sorry, trying to open as I haven't actually managed it yet some 3/4 weeks later!) an account with them, they are a shambles and the customer service is non-existent :mad:

As soon as they ever manage to get their finger out and open this account, (for which they first have to cash my initial cheque sent to them 3 weeks ago :eek: ) I'll be closing it again straight away. Inefficiency, and lack of communication or concern, at its very best there I'm afraid!

JayTee99_2

rebeccaj wrote:

wouldn't be Abbey by any chance, would it? I'm currently beginning to wish I hadn't bothered opening (sorry, trying to open as I haven't actually managed it yet some 3/4 weeks later!) an account with them, they are a shambles and the customer service is non-existent :mad:

No, not Abbey. From your description they sound pretty awful, glad they weren't on my list

Mr_Mumble

Fat_Girl_Slim wrote: »

In a recent newspaper article on 'who owns who' Legal & General was shown as being owned by Northern Rock. If Northern Rock saving are now covered 100% - i.e. beyond the FSCS £35,000 limit - does the same apply to Legal & General customers?

Legal & General are not owned by anyone else. L&G are a FTSE-100 listed company, now far larger than Northern Rock!

Legal & General do sell their investment products through Northern Rock branches (they have a similar arrangement with many other banks and building societies including Nationwide). For those who hold such investments the protection will be through L&G.

mummycarol

In your posting it says : Q: If I’ve savings with Northern Rock what should I do? But after the queues in the streets, The Chancellor of the Exchequer announced on Monday 17 September that 100% of all existing deposits with Northern Rock are totally guaranteed; if it went bust, you’d not lose a penny.

Details have now filtered through that anyone with savings in a Northern Rock account at midnight on 19 September, or anyone who closed an account between September 13 and September 19 and re-opens it in the future, will be guaranteed to get back their whole balance as at September 19, interest that they are owed, and any money deposited in the future, if the bank did have to close

BUT in today's Daily Mail money page it says, along with other things, that investors could lose a cut of their savings. So which version is right. Am sooooooooooooo confused. I have a one-year bond which expires 1st Feb and don't know whether to withdraw now and lose the 90day interest or leave it there.
Advice much appreciated.