PPI, Act Now

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With a little less than 2 years left in which to claim back mis-sold PPI act now!

When I took out my first bank loan I was told that I couldn’t have it unless I took out the payment protection policy and not understanding what my legal options were, I agreed to take it out!

This practise was not unusual so why did banks and building societies press their customers to take out these unwanted policies? It would appear that the member of staff was given a bonus for each policy that was taken out so there was a real incentive for them to insist that customer agreed to take them!

The banks and building societies were not alone in this practise as many high street electrical suppliers were also similarly ‘encouraged’ to take out unnecessary extended warranties!

However the banks have accepted that they were wrong to pursue these practises and have been repaying their customers for the mis-sold policies.

Do you remember taking out payment protection that you didn’t need or hadn’t been fully explained to you? If so contact Compi Claims today on 01942 619911 or by email at info@compiclaims.com and we can advise you what your options are.

Remember by not acting now you are still letting the banks win!


Bank of England believes Brexit could cost 75,000 finance jobs

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The Bank of England believes that up to 75,000 jobs could be lost in financial services following Britain’s departure from the European Union.

I understand senior figures at the Bank are using the number as a “reasonable scenario”, particularly if there is no specific UK-EU financial services deal.

The number could change depending on the UK’s post-Brexit trading relationship with the EU.

But the bank still expects substantial job losses.

Many jobs will move to the continent.

The Bank of England has asked banks and other financial institutions, such as hedge funds, to provide it with contingency plans in the event of Britain trading with the EU under World Trade Organisation rules – what some have described as a “hard Brexit”.

That would mean banks based in the UK losing special passporting rights to operate across the EU.

The EU could also impose other “locations specific” regulations such as where trading in trillions of pounds worth of euro-denominated financial insurance products has to be based.

That could mean trading jobs moving to Paris or Frankfurt.

There have been a number of studies on the potential employment impact of Brexit.

A poll of more than 100 finance firms by Reuters suggested the number of job losses would be just below 10,000 in the “few years” following Brexit.

I understand the bank believes the 10,000 jobs figure is likely on “day one” of Brexit if there is no deal.

The Brussels-based think tank, Bruegel, said that over time 30,000 jobs could move to the continent or be lost as London’s financial sector shrinks.

And Xavier Rolet, the chief executive of the London Stock Exchange, has suggested that over 200,000 jobs could go.

The bank believes that is too high, and its scenario over the next three-to-five years is much closer to the 2016 study by Oliver Wyman, a management consultancy which has often been quoted by banking lobby groups assessing the impact of Brexit.

Their report suggested between 65,000 and 75,000 job losses.

The study said that up to 40,000 jobs could be lost directly from financial services, with a further 30-40,000 going in associated activities such as legal work and professional services.

The report also argued that there could be opportunities from Brexit, such as developing bespoke financial services for emerging market economies across the Middle East and Asia including China and India.

Even if 75,000 jobs do go, London would still be by far the largest financial centre in Europe with over one million people employed in financial services in the capital and across the rest of Britain.

And the UK would still enjoy a healthy trade surplus in financial services with the rest of the EU worth many tens of billions of pounds.

Many also believe there will be a positive outcome to the EU negotiations as the City supports many governments and businesses on the continent in raising funds and executing global deals.

Those companies and firms would want to keep a close relationship with the UK and its well-developed global markets capacity.

Before the referendum, many banks suggested that they may move thousands of jobs.

But since then announcements have been more modest.

JP Morgan said it might have to move 4,000 jobs, but since the referendum has cut that number to around 1,000.

The Swiss bank, UBS, said it may move as few as 250 jobs after initially planning to relocate as many as 1,000.

And the chief executive of Barclays, Jess Staley, said that Brexit was no more complicated than setting up a holding company in America, which the bank was obliged to do in 2016.

More recently Lloyd Blankfein, the chief executive of Goldman Sachs, has tweeted that he will be spending “a lot more time” in Frankfurt despite the American bank building a large new HQ in London.


ECB to halve €60bn bond buying programme

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The European Central Bank (ECB) will cut back its scheme designed to boost the economies of the eurozone.

From January of next year, it will reduce the amount of assets it buys every month to €30bn from the current level of €60bn.

The programme, which aimed to fend off the threat of eurozone deflation and help boost employment, could finish by the end of next year.

Inflation is likely to be below the 2% ECB target for the next few years.

The ECB said the reduced programme would run to the end of September 2018, “or beyond, if necessary”.

If economic conditions become less favourable, or if no progress is likely to be made towards the ECB’s inflation target, it could increase bond-buying again, it said.

“Our programme is flexible enough that we can adjust its size smoothly,” ECB President Mario Draghi told a press conference.

“Today’s monetary policy decisions were taken to preserve the very favourable financing conditions that are still needed for a sustained return of inflation rates towards [target],” Mr Draghi said.

He said the ECB will reinvest the principal investment from maturing bonds for an extended period after the end of the bond-buying programme, which could run to billions of euros per month.

The decision to cut quantitative easing measures was not unanimous among ECB policymakers, and a large majority favoured keeping monetary stimulus open-ended, he said.

Markets muted

Mr Draghi has been signalling for months that the bond-buying scheme will be reduced.

“Mario Draghi’s main goal for months now has been to gently steer markets into thinking that this tapering would come today. He’s done that so markets take the announcement in their stride, which they will,” said Patrick O’Donnell, Aberdeen Standard Investments senior investment manager.

The ECB kept the key interest rate for the countries that use the euro unchanged at 0%, and its deposit rate at -0.4%.

The central bank charges banks and other financial institutions to deposit excess money with it to encourage banks to lend.


Nicky Morgan wants leaked report into RBS published

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Treasury Committee chair Nicky Morgan has called for the full publication of a leaked report into the treatment of customers in RBS’s global restructuring group (GRG).

The report, produced for the Financial Conduct Authority (FCA), suggested the group mistreated many of its clients.

RBS denies that claim.

Mrs Morgan has asked FCA chief executive Andrew Bailey to secure RBS’s permission to publish it “without delay”.

“The report is in the hands of an unknown number of third parties,” she said.

“The balance has tipped firmly in favour of full publication.”

GRG operated from 2005 to 2013 and at its peak handled 16,000 companies.

It was introduced as an expert service that would turn around a business and stepped in when companies missed a loan repayment or had a drop in sales or profits.

But the FCA report found struggling companies that were placed in the recovery group had a slim chance of emerging from it.

Four-year wait

“The FCA told the committee in November 2016 that a ‘full account’ of the findings from the skilled persons’ report would be published,” Mrs Morgan said.

“Nearly a year later, and nearly four years since the report was commissioned, we are still waiting for answers.”

“I have asked Mr Bailey to update the committee on any information that the FCA uncovers as part of its inquiry into the leak,” she said.

“This would not be the first instance of leaking from the FCA, but lessons must be learned to ensure it is the last.”

The FCA said it would respond “in due course” to the request from Mrs Morgan.

“We have already initiated a leak inquiry into the disclosure of the s166 report on RBS GRG to the BBC, and we have asked the other parties who had access to the report, namely RBS and Promontory, to do the same.

“If the Treasury Select Committee or the BBC have evidence that the document was leaked by the FCA, we encourage them to share that with us.”

‘Address concerns’

In November 2013, Lawrence Tomlinson, then ‘Enterprise Czar’ for Business Secretary Vince Cable, made several allegations against RBS in a report into the GRG.

On the same day, RBS chairman Sir Andrew Large published an RBS-commissioned report into its own lending performance, which said that the bank needed “to address the concerns that have been raised by some customers and external shareholders”.

Two months later the FCA announced its own review into the group’s conduct.


Bank of Scotland receives most complaints – again

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The Bank of Scotland remains the most complained about financial business in the UK, according to the complaints watchdog.

In the first six months of 2017 the Financial Ombudsman said it dealt with 20,541 complaints about the firm – part of the Lloyds Banking Group.

However only 22% of those complaints were upheld.

The vast majority of the complaints about the Bank of Scotland – 83%- concerned its sales of PPI insurance. Meanwhile PPI complaints once again topped the table of consumer concerns, with a 14% rise in complaints to the Financial Ombudsman in the first half of the year, compared to the last six months of 2016. In total the Financial Ombudsman Service received 89,513 PPI complaints, up from 78,375 in the previous period.

Increasing workload

Bank of Scotland was also the most complained-about financial firm in the last six months of 2016. The latest figures put Lloyds Bank in second place. The bank was the subject of more than 18,000 complaints, but more of these – 37% – were upheld.

The group has so far put aside £18bn to compensate customers who were mis-sold PPI. Last month the Financial Conduct Authority ruled that all PPI claims will have to be lodged by 29 August 2019. That is likely to lead to a further rise in complaints, as claims management firms seek to capitalise on the deadline.

“While we still don’t know what impact this will have on our workload, today’s data shows that PPI complaints are already increasing,” said Caroline Wayman, chief executive of the Financial Ombudsman Service. The peak for the number of complaints about PPI was in 2013/14, when the Ombudsman received nearly 400,000 referrals. The Ombudsman also received over 15,000 complaints about Barclays, the highest number for issues to do with banking or credit.


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