I would agree with my professional colleagues; IFA’s, brokers. The FSCS has only £4.03bn in its coffers to address all areas of its governance broken down into; deposits: £1,840m; life and pension: £790m; General insurance: £970m; Investments: £370m; Home finance: £130m.

The levies charged to brokers, banks, advisers, insurers should be proportionate to the busines activity they undertake but as ever the poor old Regulated Adviser can do nothing but put his hand in his pocket and ask the FSCS “how much?” and this is on top of an additional ‘CCJ Levy’ brought in recently.

Dave Chaundy is right – Politicians should STOP running around taking the moral high ground and promising the earth when there simply isnt any of it left.

I wonder how quick the FSA will be to instigate complaints from clients who lose money they have deposited due to the ‘risks’ of their deposit/ investment having not been explained by the untrained bank teller who simply said “I dont know, just fill in the form”.

I would also have to ask at this point, “Given the major complance failings of the FSA over the last 12 to 18 months, who is going to fine them, and by how much?”
If I, or any other broker or IFA had failed so miserably, the FSA would be handing out fines all over the place.

In respect of the NRK and B&B debacle, even Mr Cable MP doesnt really know all the details!! At a meeting with my own Lib Dem MP, in South Manchester, my MP declined to be drawn into technicality as he voted on these issues on what he had read in the papers.

Unbelievable!!

I am delighted that someone, somewhere is questioning the apparent ability of Gordon Brown to turn water into wine. To me his wine tastes sour indeed. Perhaps it is tainted with the blood of his old friend Prudence?

As a self employed IFA I object most strongly to the FSCS being used as some sort of vehicle for supporting a bankrupt system and a bankrupt government.

Gordon Brown and his ‘team’ constantly refer to the FSCS as some sort of Haven of Last Resort, as if it can solve the entire mega billion costs of every and any financial crisis.
No-one seems to ask “Who funds the FSCS and where does that money come from?”.

I know that, if it were truly the Last Resort, it is technically feasible that, if every financial institution in the UK were to go into liquidation tomorrow (except for us poor sole trader IFAs who are no allowed to) then I could end up with the entire liability myself. Bad news I am afraid – I dont have the money!

This is the ludicrous stupidity of the government and its system. Please could politicians STOP promising things they cannot deliver. STOP trying to remove risk and explain it instead. Stop feeding the public with platitudes and tell it as it really is. Hey you never know – they may actually be intelligent enough to behave with a little more prudence themselves.

Dave

The whole banking malaise could and should have been fixed by banks coming to a settlement with bondholders that maturities would be extended or bonds part-cancelled and/or converted to equity.

Reply: A deposit is a bank’s liability because the owner of the deposit can come along and demand the money bank and the bank has to pay up. The deposit is an asset of the deposit holder and a liability for the bank.

Reply: Yes, I have set out the figures several times on here – the base data is in the Freeing britain to compete download. A recent post here brought it up to date using Brooks Newmarch’s figures.

That is a very good start to the explanation, but notwithstanding Labour miss no opportunity to make things worse, I don’t really see a problem.

The alternative would have been for all B&B savers to transfer their funds to other banks, the result of which would be that other banks end up with a claim of £18 billion against B&B, which is now part of the government for these purposes.

So whether ‘other banks’ have a claim against B&B and hence against the government and hence the taxpayer; or whether Banco S has a claim against FSCS or whatever branch of the government, what is the big difference?

Reply: Why did we need a taxpayer funded solution at all? Did other banks have a chance to bid to see if could have been done for less?

The FSCS is a government designed compensation machine which is wholly funded by the financial services industry, things could get so bad that all the regulated firms might be sucked into this black hole created by HM Treasury so why should the Treasury not ‘guarantee’ it? In the unlikely event that any of this cost falls on the taxpayer the system itself would have fallen apart and caused the UK to default, imagine a bankrupt country being auctioned off to the highest, if any, bidder?

Reply: It is guranteed by the Treasury and will be refinanced by them

Anyone think I’m mad? We saw this coming but very few listened apart from Mr Cable. The regulators decided not to talk to us, their loss.

Remind me again, how well placed are we to weather the storm that was all the Americans’ fault?

Any chance Mr Cameron could broach this subject at PMQs today?

Perhaps you could follow it up with a written question to the Chancellor so that we can see his reponse documented in Hansard.

Reply: they have already failed to answer PQs