Fining Yourself

Can someone please explain to me the logic of fining the Royal Bank of Scotland? The bank has been undertaking some troublesome practices again.  The Financial Conduct Authority has found that more than half of the customers that the bank advised about mortgages, debt consolidation and the affordability of prospective mortgages were given the wrong advice. Presumably the advice was wrong for the customers but not wrong for the bank, and so the FCA has fined the bank £20.7 million with a discount of 30% if the banks pays the fine promptly.  Continue reading


It comes as no surprise that the Royal Bank of Scotland has had to set aside the £3.1 billion in order to make provision for the claims against it in relation to what really amounts to its fraudulent behaviour towards its customers. Continue reading

An Expected Day

All the leaves are gone and the sky is grey. This is what we expect in London at this time of the year. Little changes. We have also come to expect that our great British banks will be fined as more and more wrongdoing comes to light. Continue reading

Banks and Bankers – Old Habits die hard

Eight of Europe’s largest banks have been caught red handed forming cartels to fix interest rates. Two of them, RBS and Barclays had revealed the existence of the cartels and their part in them and as a result they have been spared any penalty. The others, including the hapless and hopeless state owned Royal Bank of Scotland, have been fined €1.7 billion. Continue reading

An Investigation Into a Bad Bank

Lending by banks is a bit like umbrella lending; when it starts to rain the lender takes the umbrella back; what RBS seem to have done is reverted to the lending practices that prevail in the undeveloped and developing world; when it starts to rain not only does the lender take away the umbrella, but also takes away the borrowers clothes off his back and the shelter in which he lives. Continue reading

Bad Banks

It is not surprising that claims are beginning to be made in the press that the banks have behaved rapaciously and immorally. The latest allegations is that RBS, a bank now mainly owned by the taxpayer, has squeezed some assets from some of its borrowers and put the borrower into liquidation in order to acquire the asset for a fraction of its real value. Continue reading

Banks: the chickens are coming home to roost

Bankers’ bonuses are going to be capped. The poor dears who rely on their bonuses to maintain their life styles will, in the European Union, have their bonuses capped to the equivalent of their annual salaries. It will be a small step on the right path and in the right direction, but it fails to deal with the underlying problem that the banks have caused and still cause for our economies. The second small step will be to separate the traditional banking business for taking deposits and lending from the highly speculative activities which involve what is in effect gambling with other banks. Continue reading

The “help yourself” bank

The Royal Bank of Scotland is one of the United Kingdom’s largest banks. A few years ago it became insolvent and by any normal rule of business, if the shareholders were unable or unwilling to support it, the bank should have gone into insolvent liquidation. However, irony of ironies, the government deemed the bank too large to fail and supported it with so much cash that the government (or taxpayers more accurately) now owns 81% of the bank. Continue reading

The great unanswered question of the banking crisis

The problems that banks are causing to economies around the world are continuing and we shall hear more of them as time goes by. The latest news is that regulatory authorities have fined UBS one billion US dollars for manipulating LIBOR rates. Other banks have already been fined and more banks will be fined in future. Using a fine as a means of punishing a corporation for what is clearly criminal behaviour is a soft option. However the regulatory authorities and prosecutors have little choice. Continue reading

Another Fine Mess the Banks have got us into

By foolish speculation with the money of their customers banks have caused many problems for most people in most economies. It seems that the bankers cannot resist a free gamble with other people’s money. Also, whilst insisting and monitoring prudence in their customers who borrow, the banks manage to borrow recklessly, leveraging their deposits into realms of what should be fantasy but is unfortunately reality. As though this damage was not enough we find that banks are not paying sufficient attention to their core business, of getting and looking after the money of the poor mugs who have to use banks. For the past week NatWest, the Royal Bank of Scotland and other banks in that group have managed to mess up what should be a simple business of recording money going in and going out of the accounts of their customers. Continue reading