ENDOWMENT policyholders face yet more misery with their mortgages this week, says the Times, as an a...
ENDOWMENT policyholders face yet more misery with their mortgages this week, says the Times, as an announcement from the Financial Services Authority is expected to worsen the crisis and projected shortfalls.
A change to the rates of return that providers use to project potential returns is being altered for with-profits endowments, suggests the Times, because insurers have had to change the content of such funds over recent months.
Latest estimates indicate there are more than 2.9m with-profits and unit-linked endowments which are unlikely to meet their target.
Similarly, however, the FSA says it is up to companies to make sure policyholders are not lead to believe there is going to be a shortfall, if there is not, continues the Times.
THERE is absolutely no evidence to suggest that regulating mortgages under the Financial Services Authority will be of benefit to customers, says Alliance & Leicester in this morning's FT.
Richard Pym, chief executive of the group, says the real concern is the pre-application paperwork and warning which must be delivere, under the FSA regime, to consumers looking to take out a mortgage.
Pym argues that there is no indication at this stage whether adding so much additional paperwork will improve a consumer's understanding.
Early redemption penalties on loans costs consumers around £332m a year, even though 70% of all loans are repaid early, says evidence from Egg published by the Times.
Egg claims that of the 7.7m personal loans taken out in 2002, 70% will be repaid early, with almost 75% of lenders charging around two months interest for the privilege of paying it off early.
Only five lenders - Nationwide, Virgin Money, Barclays, Woolwich and Intelligent Finance - are thought to have no redemption charges.
More news on NPI has emerged from Australia in this morning's FT, as it is revealed AMP has now closed its UK pensions unit to new business.
AMP had been looking for a buyer for the UK financial services units Pearl, National Provident Institution and Henderson Investors, but it is now going to close NPI with the loss of 900 jobs.
AND YET more talk of excessive boardroom pay has emerged, after the Daily Telegraph revealed outgoing Scottish & Southern Energy chief executive, Jim Forbes, is being handed a £114,000 bonus which increased his pension pot to £7.2m.
On this occasion, the board voted to reclassify his bonus as salary, to help boost his pension before retirement.
According to the Telegraph, Forbes received a total salary of £526,000 in 2003, compared with £786,000 the year before, because he only for six months this year before retiring on an annual pension of £509,000.
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