Not sure if this thread will catch on, because no-one here seems to have much to say about individual british banks, but thought i would add this header to see if we could discuss dividend yields, exposure to sup-prime, good ones, bad ones, take-over targets, when the crisis will end? do you think they have learnt their lesson? I, for one, as a property developer have seen first hand how much stricter they have become with lending habits, struggling to get decent rates for re-mortgaging, basically they appear scared to lend to anyone.

Americans simply dont have enough money to pay their credit cards and mortgage repayments.

Take B.Stearns they were $170 a share a year ago and $50 a share last Friday and they have sold to JPM for $2 a share ...who is to say that wont happen to Britsh Banks..

If the UK housing market collapses it will take HBOS with it as they have massive exposure to th housing market.. no bank is safe.

DARLING BANK the safe.

UK banks should not suffer to the degree bear stearns did. There are many differences, not only in the product offering, but in the regulatory system. They will suffer though.
To call it a sub prime crises is now, for me, officailly a misnomer. Lenders accross the UK are now pulling in their horns on prime loans too. This is due not to risk, but to illiquidity and an end to the money go round.
The question now is how and when this will end. I thought I spotted signs of it about 6 weeks ago, with sub prime lenders sourcing their money in Switzerland, but even that hasn't worked. The thing now is to let capitalism take its course. There is a huge supply gap opening and someone will fill it. But they can only do that as and when the property market has a correction. While we are being told it must come, loan to values are low are they are only willing to lend to their best estimate for a value that is likely to drop. Once it has happened, we will see a rise in loan to values that will start consumerism up again.
Just as a rising market feeds off itself, a falling market does too.
The answer, for me, is a short until secured lending eases, then go long. Watch the rates and more importantly the criteria and as that eases you will know that the property market, and by extension the banks business, is about to turn up.
The reason the USA suffered most in this is simply their mortgages tend to be of the flexible type, where all spending is part of the mortgage, including credit cards, car finance and even buying a fridge at your local Walmart. Imagine how bad it would be here if all the potential defaultees included every bit of their lending in with their mortgage.

$2 for BEAR STEARNS.Despite "challenging times," the U.S. government is "on top" of the unfolding financial problems, President Bush said Monday at a Cabinet meeting. Bush said he was supportive of the actions of the Federal Reserve to restore order to the markets. "Our financial institutions are strong," Bush said, adding that "capital markets are functioning efficiently."

Bank shares now on the way up.

http://depression2.tv/d2/node/42

I fancy HBOS as a short, not only are they exposed to the UK mortgage market, but also have a massive expoure to near sub prime lending (7.0bn). Worth a short on any bounce. imo.

You may be right, spitfire.
From an industry point of view I can confirm to you that the Halifax have taken 3 unusual steps recently which seem aimed at reducing exposure.
1) The best secured deals they offer are now only available to existing mortgage customers, new customers do not seem very welcome
2) Their sub prime arm has banned all lending that is used for consolidation puposes
3) They have reduced their maximum personal loan amount from 25k to 13k

That looks to me like they have decided they do not want to attract any more custom.

Best short in the market due to the UK housing exposure.

See chart below,

HBOS have had a hell of a fall in last 3 weeks from 700 to sub 500, I notice that the last lower high or resistance is just below 600. Now if markets bounce and HBOS fails to break 600 and falls, it may be a good entrance for a short.

Read somewhere earlier HBOS is the least stable of our banks with a larger chunk of exposure to bad debts than the others... will look to short on any strength as i believe the credit crisis has plenty to run yet...

HBOS in trouble?

Wishing i had courage of my convictions... less than three trading hours ago, i wrote about shorting HBOS...! I have certainly lost my bottle after being burnt heavily in past few weeks...
Incidentally, how long before Citibank goes the same way as Bear...?

According to Fortune, "Bear Stearns is dealing with a classic run-on-the-bank. The firm's short-term creditors refused to lend the firm any more money via the extension of overnight loans, and simultaneously demanded repayment of outstanding debt. The one-two punch overwhelmed Bear's cash position, forcing it to seek help. Had the Fed not stepped in, it appears doubtful Bear could have operated today.... In short, the Fed is allowing J.P. Morgan - a commercial bank - to act as a conduit for pumping cash into Bear Stearns. The bank is being permitted to give Bear Stearns collateral at the Fed's emergency-lending discount window to secure 28-day financing, which in turn is lent back to Bear Stearns in order to finance its business. The Fed's role in the deal suggests federal officials fear a systemic collapse of the U.S. financial system were Bear Stearns to fail. The fear stems from Bear central role in a multitrillion-dollar web of interconnecting derivative contracts."

If Citigroup dos not get an injection of cash soon it is going to blow up just like Bear Stearns. That is why the Fed tried to bailout Bear. It is worried that if one bank collapses investors will wake up and connect the dots and realize that the balance sheets on other Wall Street banks are works of total fiction too and cause panic in the stock market and a run on some of these banks. Banks that made stupid mortgage bets deserve to suffer, but the Fed is owned by the banks and works on their behalf instead of the greater good of the general welfare of our country. The costs of the bailout are born by you at the gas pump and the inflationary pressures created by a falling dollar.

Banks tanking today, apart from lloy, hsbc and stan take your pick of which bank to short. Can't see hbos getting anywhere close to 600 level now, so will have to think about a level to short these.

Best short in the market.. read somewhere they are to announce a 5 bill package to support their liquidity problems.

Shares of UK mortgage lender HBOS plummeted more than 18% in early London trade on rumors that the company approached the BoE for emergency funding. HBOS spokesmen denied those rumors but markets remained jumpy and turbulent in the wake of the Bear Stearns disaster, with traders preferring to sell first and ask questions later.

Cable dropped nearly two big figures on the HBOS news while the latest economic data from UK only added insult to injury by showing a slowdown in UK labor markets. UK employment data showed a substantial weakening in labor demand as unemployment rolls were reduced by only -2.8K versus -5.0K expected while wages grew at 3.7% annual rates versus 3.8% forecast. Furthermore, BoE minutes which were expected to produce an 8-1 vote revealed a vote of 7-2 instead suggesting serious concerns about economic growth

Given the recent turmoil in financial markets it now appears that the BoE will be much more likely to ease at the next MPC meeting in April. and if tomorrows UK Retail Sales data shows a more than forecast decline, chances of a 50bp rather than merely a 25bp one will increase markedly. Tonights news clearly creates additional risks for the pound going forward as UK may become the next G-10 member to follow the US into a recession.

IG will double its margin requirements on most bank positions next week.