Monday, 17 September 2007

Northern Rock Debacle

I just cannot believe what I am seeing on the news. The queues at Northern Rock Banks of hundreds of people patiently waiting to get access to their money. The whole tribe of leaders, bankers, experts, politicians wheeled out to tell us all that our money is SAFE in Northern Rock. No problems. Don't panic. The website is running as normal - it 'maybe a bit slow' as so many people are trying to get online to transfer their money out. Does anyone know of anyone who has managed to log on to even look at their balance? You can't even get online to open an account - if you should wish to do so - if you wanted to show your faith in the bank.

I am so sorry for all the staff at Northern Rock. From staff at HQ, to the IT Dept, and all the counter staff. I expect they are getting a lot of flack and aggro from anxious savers. At the same time they will be worried about their own jobs. The standard of staff and paperwork at Northern Rock has been exemplary. Far superior to any other bank I've had dealings with. That's why it is such a sad ending to a fine institution. It's the bosses who are to blame - and the shareholders along with the FSA and Govt.

Now I'm a saver and so is my husband. We can't afford to lose money. But as our accounts are postal and have penalties attached for cashing in early - then there is no easy access to our money however much I would like to panic and take it out. Unless the bank and its obligations are taken over we are likely to lose some of our savings. The FSCS scheme only pays 100% on the first £2k and then drops to 90% for the subsequent amount to a maximum of £33k. This sum was set up with the scheme a few years ago. I don't know whether it will ever be reviewed. Some people have had far more than £35k invested - perhaps they weren't told of the maximum re the FSCScheme as a last resort if a bank fails - perhaps banks should be required to do so in future.

Now - I also have a smallish sum - my ready cash savings in the Silver Saver On-line. There is no way I can access that at the moment. I did try at 3.30 a.m. But I am reluctant to anyway because what would happen if I arranged a BACS transfer and while my money was out there in that mysterious world of the etherbank - that strange place where I get no interest on it - while it has left one bank and takes 3-4 days to arrive at the destination bank - what would happen if the Northen Rock bank suddenly ceased trading? Would I be covered then by the FSCS scheme? Or if the NR Bank sent my money to me as a cheue through the post. My money in a cheque. But before it was paid in and cleared as cash in my current account - would I be then be an unfortuante creditor only or would I still be covered under the FSCS scheme?

Knowing how this Govt. has refused to help out pensioners with collapsed pension schemes and the Equitable Life customers; also the FSA seems very toothless when dealing with this - then are any of these schemes worth the paper they are written on? At our age we can't afford to wait xx years to find out if we will get compensation should a bank collapse and cease trading.

This latest panic on the high street just shows how none of us trust our leaders when they tell us we have nothing to worry about. They have squandered our trust over the last 10 years and are now being hoist by the petards [whatever they are!]. I hope it's painful for them all.

18/09/07 - Well said Libby Purvis : http://www.timesonline.co.uk/tol/comment/columnists/libby_purves/article2477756.ece

19 comments:

Mark Wadsworth said...

You are right (having read other blogs on the topic).

Just hang on until fixed period for your postal account expires and then saunter into the branch and ask for your readies. By that time either it'll have sorted itself out or been taken over by somebody else. Banks take over otehr banks all the time (or at least they did it a lot in the 1990s, with the demutualisations and all that), it's not a big deal.

teeni said...

I hope you don't lose anything Penny. Even if you don't have a lot in there, you earned it and it would be a shame to lose it through no fault of your own. This stinks. Keep us posted.

Flowerpot said...

I was talking to a friend earlier who's ion exactly the same position as you, Penny. Hold on in there!

Glamourpuss said...

Well, as someone who has been trying to get a mortgage review through for the past four months, my opinion of NR is not printable. And now that this has happened, all hell has been let loose.

Dreadful.

Puss

lady thinker said...
This comment has been removed by the author.
lady thinker said...

oh dear - tech problems -

hello glamourpuss - sorry about your troubles with Northern Rock - can only assume they not so good due to recent circumstances? but I stand to be corrected - I only had dealings over the last 9 years as a saver.

toby said...

Not sure this govt will be "hoist by its own petard" unless the problems spread to the wider economy. North England voters instantly believed the chancellor's money back "guarantee", only a few southerners continued to queue after that. The theft of occupational pensions has had no impact on voter surveys. Neither has the forced emigration of junior doctors or Iraq or...

lady thinker said...

Tobeeee - lovely to see you again.

Well - what do the voters have as a viable alternative?? I ask you - I despair - what are we coming to?
I am beginning to dream of moving to Iceland or Switzerland. The former for the space and peace and quiet. The latter because it is (?was)well run. But when I was last there (over 20 yrs ago) was told off for crossing an empty road before the traffic lights had changed to pedestrians... not sure I'd fit in that well .. I prefer rules that make sense but with some leeway for commonsense.

lady thinker said...

I still don't trust what our minister has told us. So this evening have been online to remove most of my Silver Saver money. It should be in my current account in a few days.
Now I only have a few weeks to go before I can gain access to my 1 year bond. I hope Northern Rock will stay in business for a few more months yet. Before the EU tell OUR PM that he can't shore up a failing financial institution as I believe is against EU rules. But as we are not in the Euro maybe it doesn't matter.

My mind is not made for this - it's only made to either save or spend the stuff - not worry about it.

toby said...

Reckon the EU has taken over Blogger. There are weird German phrases popping up everywhere; like "Sie konnen HTML-Tags verwenden" beneath comment boxes! Half the profile options are German now too!
Or is that just me.
Hope you rescue all your savings. It's not a problem I am familiar with, as I don't have any yet :)

Mark Wadsworth said...

LT, in Blogspot, do you know how to turn off the function that enables people to go back and delete their own comments, e.g. above 18/9 at 21.01?

Word verification: rizzzo (out of 'Grease' presumably)

lady thinker said...

Mark - I'm not sure that I've looked for this. Interesting ... but this was my own error ... It was a bare few words that I'd just started to type and my fingers pushed the wrong button far too quickly... I do that when replying to a text too sometimes - often fire off a blank message - my fingers are faster than my brain.

I do hate it when there's a 'This Comment Removed by Blog Administator.' - I get feelings of paranoia - and wonder whether I overstepped the mark in such a way that a blogger feels obliged to erase it! Unfortuately you (well I) can't always remember what comments have been left where. I wish blogger would send copy to our email thus enabling trip back to follow up later.

Now if someone leaves a comment then changes their mind and deletes it - TOO LATE - as it has winged its way into my email box - I've sometimes been surprised to find an innocuous comment has been 'removed by author'.

lady thinker said...

Toby - This German thing - everyone started to chat about it a few days ago ... see comments on
http://sidmouth-town.blogspot.com/2007/09/panic-attacks-in-north.html

Also henry and mark were chatting on this in their blog comments around this too....

As to savings - these only started to appear in my latter half of life... but they likely to be diminished soon as we are now eying up LCD TV's and DVD recorder etc etc. Transmitter in East Devon due to be cut off soon ...

Mark Wadsworth said...

Now if someone leaves a comment then changes their mind and deletes it ...

You can set your template up to forward all comments to you via email, go to 'settings', 'comments' and then 'email notification' at the bottom. Or is this what you meant you've done?

merry weather said...

Hello Lady Thinker!

Gosh, it's hard to get your attention in here these days, all these buddies jostling for your ear :)

Little sis here - sorry to hear you've got all this worry with Northern Rock :(. It must be a worry, nothing is sacred when based on money it seems. Do hope it works out in your favour. x

merry weather said...

By the way, just thinking about deleted comments - I can remove those on my blog, it's a 2 step thing, the trash can sign appears twice. You do it from the dashboard posting screen. Not that I've done it often, only with the odd spam thing.

Also, are you black-listing Switzerland for an incident 20 years ago? - Gee, how cross you can be! - Hope I don't ever feel your wrath!! x

Around My Kitchen Table said...

Good luck with Northern Rock. What a shock it is when some well-established institution starts to get into trouble. But it does sound as if the crisis has been nipped in the bud and your money is safe. I hope I'm right, for your sake, and not being overly naive and optimistic.

lady thinker said...

Mark - yes mine is set up to receive comments by email so even if someone has deleted it i do get to see what they deleted - invariably typo errors or duplicated comments.

Merryw - I've not got a downer on Switzerland - I'm just not sure that I'd be good enough for them -? not law abiding enough for them. It does illustrate though how long one can still feel embarrassment over a public telling off.

lady thinker said...

AMKT - thanks - it does sound as if the govt will support NR out of it's current difficulty - at least until Gordon Brown gets the other side of the next election.
I remember other promises of his that only lasted as long as he needed to get safely to the other side of election day.