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.

Many thanks, all of you for your help Have been dying all weekend so only read today. Will ring my broker and sort it out.

Worth looking at the link below, which is an interview with Diana Choyleva from Lombard Street. Interesting angle on the libor rate and the large clearing banks, I hadn't thought about the reason for high libor, but I agree with her it makes sense for the large clearing banks to take advantage.

See what others think.

www.ft.com/cms/893ac9c8-757e-11dc-b7cb-0000779fd2ac.html?_i_referralObject=734371838&fromSearch=n

Funny how the press can skew the news to create panic and sell papers.
The Guardian reports shock horror that C&G has pulled its entire mortgage range, and that this is the harbinger of doom and the first horseman of the apocalypse to ride out among the leafy streets of suburbia.
The truth is, this happens almost every week (recently almost every day) from one lender or another. It is always down to a rate change or the lender concerned getting its predictions of future rates wrong. C&G were among the cheapest recently and their withdrawal is no suprise in the industry. Bringing the range back at 0.25% more is no more than aligning itself with other lenders.
The Guardian report it as though it is an unusual and one off event, sparked by crisis and panic. They will not be happy until they have caused the housing and money markets to fall off a precipice with their inaccurate doom mongering.
If you want to blame anyone for UK financial problems, look no further than a self interested media looking to sell their tatty rags.

Agree with you Alan. Form somebody who once did a media course, I hate them. Problems don't start with them but they don't half turn the knife for their benefit only. These days only one thing matters to the media, ratings and sales.

The Barclays situation is another example.
The press report it as though the bank is out of cash and desperately needing to visit its shareholders with a begging bowl. Its on its knees and staring bankruptcy in the face.
The truth (though it won't sell papers) is that they are inundated with applications they wish to service to the point where staff are doing overtime and they have an active recruitment campaign. They simply do not have enough cash to ensure they do not breach the 5% capital adequacy rule to supply more in lending than they have ever been called on for before. This is a problem, of course, but its not a bad one.
Evidence? Look at First Direct who pulled out altogether for 7 weeks, just to catch up on a backlog. That is the alternative for Barclays, not the bankruptcy the media hint at.

Sorry to go on, but then theres Citigroup (AKA Future Mortgages) who are reported today as closing its book. They made the decision to scale down and eventually pull out 3 years ago.
My understanding is that this had little to do with any dire forecasts, just a realisation their model was not good enough and unlikely to compete very well with GE Capital and General Motors who were emerging as the biggest and most aggresive players.

What date is the last date to hold RBSN before you have to stump up the issue price. if they keep falling is it possible that you could pay more than they worth?
ie RBS goes below 2
Alex

Exactly! I have loads of the bl**dy things! If things carry on like this, if you believe in the company then it may be better to buy the shares at 150p than take up the rights issue! lol I think greed will get the better of people as the sp slips towards 2.

Money needs to received by 6 June and the new shares start trading 9 June. No info about when RBSN stop trading (5-8 June?)

I know sometimes we love our shares too much

Don't know if UK banks are mentioned as I have still to listen to the link myself, but thought that the programme title looked interesting.

http://www.bbc.co.uk/worldservice/

Could be a bad day for lloy Tuesday, see link below re-miss selling rumours with Scottish Widows. With more possible writedowns and a rights issue from UBS and rumours about hidden CDO losses in Lehman Bros it may be a bumpy ride for all banks.

http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article3998860.ece

Anthony Bolton, one of the City's leading fund managers, called the top of the commodities market yesterday by arguing that he would switch out of metals and oil and move his funds into financial stocks. Speaking in a television interview, Mr Bolton, who stepped down from running Fidelity's Special Situations Fund in January, said: After five years of strong commodity markets, a contrarian such as myself would start to get more worried. I would switch out of commodities today and move into financial stocks, reports the Times

Worth a read of a paper report copied below, if I can find out the CDS figures for UK banks I will post them here.

"The debt markets in the US and Europe have begun to flash warning signals yet again, raising fears that the global credit crisis could be entering another turbulent phase.

The cost of insuring against default on the bonds of Lehman Brothers, Merrill Lynch and other big banks and brokerages has surged over the last two weeks, threatening to reach the stress levels seen before the Bear Stearns debacle. Spreads on inter-bank Libor and Euribor rates in Europe are back near record levels.

Credit default swaps (CDS) on Lehman debt have risen from around 130 in late April to 247, while Merrill debt has spiked to 196. Most analysts had thought the coast was clear for such broker dealers after the US Federal Reserve invoked an emergency clause in March to let them borrow directly from its lending window.

But there are now concerns that the Fed itself may be exhausting its $800bn (399bn) stock of assets. It has swapped almost $300bn of 10-year Treasuries for questionable mortgage debt, and provided Term Auction Credit of $130bn.

"The steep rise in swap spreads this week is ominous," said John Hussman, head of the Hussman Funds. "The deterioration is in stark contrast to what investors have come to hope since March."

Lehman Brothers took writedowns of just $200m on its $6.5bn portfolio of sub-prime debt in the first quarter even though a quarter of the securities had "junk" ratings, typically worth a fraction of face value.

Willem Sels, a credit analyst at Dresdner Kleinwort, said the banks are beginning to face waves of defaults on credit cards, car loans, and now corporate loans. "We believe we're entering Phase II. The liquidity crisis has eased a little, but the real credit losses are accelerating. The worst is yet to come," he said.

The jump in corporate bankruptcies has not yet been picked up by the usual indicators, which tend to lag the market, lulling investors into a false sense of security. The true losses are already known to specialists in the business, said Mr Sels."

Interesting video on the FT site which suggested the investment banks such as LloydsTSB are keeping libor up and deliberately starving the non investment banks such as B&B of cash... The intention is possibly to pinch their market share and then buy them up on the cheap...

LTSB will be pleased to learn they are an investment bank!

brianboru

is this the interview with Diana Choyleva

when you think about it, it makes sense for the clearing banks to keep libor higher and take advantage of the difficulties caused to al. bb. and hbos.

Just a thought.

Miners and banks appear to trade in opposite directions. With miners about to break technical levels, it feels as though they have lost their gloss. It may only be temporary of course but with banks at very low levels and RBS and B&B near their rights issue prices, is this the start of the turnaround. Time will tell of course. IMO the initial surge in banks sp's today will disapppear and today at least miners will come back. We shall see!

Buffett did say he would not look into banks until Q3. Are we there yet? I am going to start buying small amounts in a diversified bunch anyway, be most brave when people are most fearful so the Sage says

Sorry, clearing banks and non clearing banks...

Spitfire, yes it is Diana Choyleva under view from the markets...
http://www.ft.com/cms/893ac9c8-757e-11dc-b7cb-0000779fd2ac.html

Now the banks have to sell assets...looks like the banks are far from bottoming out...


Royal Bank of Scotland and other European banks are having to sell assets to repair their battered balance sheets and will have to settle for low prices.

Buyers are scarce because funding is tight for private equity firms and because the better capitalised banks that might be interested can afford to hold off on acquisitions until the price is right.

"RBS Insurance is a classic example where a bank has in mind what it thinks is a fair price but the reality is people's ability to pay is pretty constrained," said Simon Maughan, analyst at MF Global.

"If we do see asset sales it could take a few more months for the sellers to capitulate (and lower price expectations)," he said.

RBS (RBS.L: Quote, Profile, Research) may struggle to achieve the 6 to 7 billion pounds it wants for its insurance arm and it is not alone in looking to sell assets in tough markets, bankers say.

Still, cut-price deals may be better than dilutive share issuance.

Multi-billion-euro rights issues are repairing the most stretched balance sheets, but with more writedowns on toxic holdings and low growth ahead, asset sales could be the key.