A MASSIVE ROW has broken out between the FSA and the government's own actuaries over plans to improv...
A MASSIVE ROW has broken out between the FSA and the government's own actuaries over plans to improve protection for life insurance customers, the FT reports.
Instead of helping consumers by "shining a light" on boardroom practices, the FSA's plans will just encourage more bureaucracy and actually produce worse outcomes for consumers at the end of the day, according to the actuaries' criticisms.
Most of the trouble stems from the collapse of Equitable Life, and subsequent proposals to shift responsibilities from scheme actuaries to boards and senior management.
Government actuaries say there is not evidence that Equitable's problems were caused by the appointed actuarial system.
BRADFORD & BINGLEY'S acquisition of IFA Holden Meehan has ended its statutory protection from predators two years before the protection was due to expire, and it is set to stoke bid speculation in the City, The Times says today.
B&B has committed itself to growing through acquisitions itself, such as through buying £1bn worth of mortgages from GMAC, but there are also plenty of banks that would see the company as a natural fit, the paper adds.
Barclays, Bank of Ireland and even insurance companies could be tempted to take one of the last remaining independent banks that the government will allow on the block – Lloyds TSB's bid for Abbey National was blocked for regulatory reasons.
PROPOSALS PUT forward by the Basel Committee on Banking Supervision yesterday threatens to overheat the global residential property market because it is being suggested that mortgage lenders be able to reduce the capital reserves that must be held against such loans.
The FT reports that the change could cut the reserves needed by up to 12.5%, which would encourage lenders to "overlend" in already heated markets.
The proposals are down to the Basel II process, which is attempting to harmonise banking supervision requirements on a global scale.
Although any new rules will not have to be followed by 2006, big banks in Europe are well into their planning for the new regime.
THE ISSUE OF capital reserves has led FTSE 100 member Amvescap to threaten a move from the London Stock Exchange to a listing in New York, The Daily Telegraph reports, if the FSA's plans to force fund mangers to maintain capital adequacy in the same way as banks is forced through.
Amvescap argues that since it does not lend money it is not a bank, and so should receive different treatment, or at least "relief" from the new rules.
CHANCELLOR GORDON Brown's deficit gets bigger by the day: this time the National Institute for Economic and Social Research says that by 2005-6 government spending will be £40bn into the red, against a planned level of £23bn.
The culprit in this is tax revenues, which will not rebuild as quickly as the chancellor thinks, the institute says, because – surprise – people are going to be focused on rebuilding their savings rather than increasing consumption at the levels forecast by the government.
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