NatWest Online Crashed

NatWest online has just crashed, and apparently NatWest debit cards are not working either!

As per NatWest site:

"We're sorry but online banking is temporarily unavailable. Please try again later.

If you continue to experience this situation please contact the online banking helpdesk for further assistance.

For a list of helpdesk numbers, please see our page of contact numbers "

They fail to mention that their debit cards don't work either!

Oddly enough, Nationwide are also experiencing problems.

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What's The Similarity Between Mortgage Providers and Ratings Agencies?

The Telegraph reports that Ray Boulger of mortgage broker John Charcol thinks that house price indices, provided by mortgage providers, are a farce.

"The way providers of house price indices seasonally adjust their figures is a farce (or, seasonally adjusted, a comedy).

In many months the seasonal adjustment skews the real figures so much the result is that the comment generated is often misleading."

The issue runs much deeper than seasonal adjustments.

Mortgage providers' statistics are to the housing market, what ratings agencies' ratings are to sovereign debt. Both parties use their "ratings/stats" to manipulate the market to make money out of it.

Of course the statistics are unreliable!

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House Price Rise Slows

Unsurprisingly the brief and modest rise in house prices, that has been latched on to by the housing industry and the politicians as signs of a recovery, is beginning to slow.

Nationwide Building Society report that the cost of a home rose by 0.5% in November. However, the rolling three-month index dropped to 2.8% from 3.5% in October, and 3.8% in September.

This fall is hardly surprising, much of the "rise" was due to a shortage of property available for sale in the market. Additionally, the number of job losses continues to mount.

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The Return of The 125% Mortgage

Hot on the heels of a warning from Barratt Developments and Redrow, that stability in the UK housing market were being undermined by banks' reluctance to provide mortgage finance to borrowers, comes a new product from Nationwide.

Nationwide are bringing back the 125% mortgage, for homeowners facing negative equity.

The product will only be available to existing customers wanting to move house, whose homes are now worth less than their mortgage.

Borrowers in negative equity can get a new mortgage worth 95% of the value of the new property. They have to fund the remaining 5% in the form of a deposit, but then they can also carry over negative equity in their original home. The negative equity carry over can be worth up to 25% of the total cost of the new property.

However, Nationwide caution:

"We're certainly not relaxing our lending criteria."

Others will now be forced to follow suit.

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Mortgage Rates Set To Rise

Nationwide Building Society will raise its fixed mortgage interest rates today, on its most popular mortgage deals, by between 0.26% to 0.86%.

Other lenders are expected to follow suit, as they seek to reduce the demand for their products as the Swap rates (which dictate the cost of fixed rate lending) rise.

Needless to say, savings rates will not be increased.

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House Prices Rise

House prices rose by 1.2% in May.

However, before you crack open the champers, I would draw your attention to the following:

1 The figure is provided by Nationwide, an organisation with an interest in talking up the market.

2 One swallow does not make a summer, prices are 11.3% lower than they were a year ago.

3 Rising house prices will not necessarily get people back to work.

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Dunfermline Building Society "Saved"

The Dunfermline Building Society has been broken up, with its non toxic elements going to the Nationwide Building Society; whilst the taxpayer has bought the toxic assets.

Under the deal the Nationwide absorbs the brand name, £2.3BN of retail deposits, 34 branches and £1.02BN of mortgages.

The taxpayer takes on poor quality buy-to-let loans.

FYI, the Dunfermline Building Society resides not a stone's throw from Gordon Brown's constituency. Fortunately for Brown, with only a few days to go before his much vaunted G20 summit, he will be saved the embarrassment of seeing his local building society going bust.

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Falling House Prices

It should come as no surprise to anyone to learn that the fall in house prices last year of 15.9%, as per a survey by Nationwide, was the largest fall since they began keeping records in 1991.

Unsurprisingly house prices are predicted to continue to keep falling this year. The Times notes that Howard Archer, chief UK and European economist at IHS Global Insight, estimated that house prices will fall another 15% in 2009.

Whilst the MPC are expected to cut rates by at least 0.5% this week, the level of interest rates alone will not be enough to staunch the losses. Until credit is once more flowing freely, there will be no respite to the ongoing property collapse.

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The Bankers Strike Back

The major high street banks, never fearful of damaging their already trashed reputations, will go to the Court of Appeal today in a bid to overturn the High Court ruling that unauthorised overdraft charges are unlawful.

The banks lodging the appeal include; Abbey, Barclays, Clydesdale, HBOS, HSBC, Lloyds TSB, Nationwide and the Royal Bank of Scotland.

Whatever the outcome, not expected to be decided for quite some time, the banks will ensure that they make money out of their customers one way or another. In the event they lose the appeal, they will simply abolish free current accounts.

It's as simple as that!

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Nationwide Warning

Nationwide has warned that a recession may now be likely, as the average house price in the year to July fell to a three-year low of £169,316.

The average price of a home is now £15,000 lower than in July last year.

Nationwide state that house prices have fallen nine months in a row, and in July declined by 1.7% (in June the fall was 0.8%).

The question is what will the Bank of England do with rates this month?

There is of course a silver lining to this. Those who waited to buy a house, and did not rush into borrowing ludicrous multiples of income, are now in a much better position than a year ago.

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Banks Speed Up - Sort Of

A rare piece of good news for bank customers whereby the banks, whose reputation has sunk to an all time low, have actually started to do something the benefits their long suffering customers.

A banking scheme for one-day cash transfers over the phone or on the internet has started.

This is designed to speed up the process of transfers, which previously took up to four days.

Can you guess what happened to the money being transferred during this four day period?

It earned the banks a very nice £30M in interest per annum.

How nice for them!

Under the new scheme customers will be able to make one-off payments, up to a maximum value of £10K, over the telephone or via the internet. These payments will leave their account and arrive at the destination account on the same day.

The 13 banks included in the scheme are: Abbey, Alliance and Leicester, Barclays, Citi, Clydesdale and Yorkshire Banks (National Australia Group), Co-operative Bank, HBOS, HSBC, Lloyds TSB, Nationwide Building Society, Northern Bank (Danske Bank), Northern Rock, and Royal Bank of Scotland Group (including NatWest and Ulster Bank).

I wonder what the catch is?

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The Falls Continue

House prices continue to fall, Nationwide's measure of house prices has shown the first annual fall in 12 years.

Prices are now 1% lower than this time last year.

For those who already own property, and are seeking to move, the fall should not affect them as the effects of a reduction in selling and buying prices will cancel each other out.

However, first time buyers may not be helped that much by this fall; as mortgages are now proving very difficult to obtain and many lenders now require a 10% deposit.

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Mortgage Misery

The mortgage misery continues with an announcement by Nationwide and Abbey that will dampen the ardour of those borrowers who do not have a deposit of at least 10%.

As from Thursday, Nationwide will offer loans for 95%t only to existing borrowers or people taking out a three-year, fixed-rate mortgage.

A from tomorrow, Abbey will have only one deal left for homeowners with 5% equity — a five-year, fixed-rate deal charging 6.99%.

In other news it seems that the EU will be taking a close look at the Bank of England's attempted rescue package of £50BN, there is a risk that the EU will declare it unfairly subsidising British banks.

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Housing Market Weakens

The gloomy clouds shrouding the housing market continue to cast their shadow. Nationwide report that house prices fell by 0.5% in February, for the fourth month running.

Hoverer, measured on an annual basis, house prices are still rising by 2.7%. This is the lowest annual growth rate since November 2005. Less than a year ago house price inflation was 11.1%.

Adding to the gloom, the Land Registry report that the total number of houses sold in November 2007 fell by 20% compared to November 2006.

Nationwide, whose job it is to sell mortgages, publicly remain calm about the situation; they note that the fall in annual house price inflation, between January and February (annual house price inflation in January was 4.2%), could be overstating the trend.

Nationwide also noted that the fact that the UK does not seem to be heading for a recession should provide some support. They forecast flat house prices for 2008.

The property market, just like all other markets, is driven in part by sentiment. The sentiment, and future direction of the market, will depend on there being no further unpleasant economic/financial shocks this year.

Does anyone have a crystal ball?

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Nationwide Puts Up Rates

As the effects of the self induced banking credit crunch continue to ripple through the economy as whole, Nationwide has told customers wanting a loan for over 75% of a property's value that they will have to pay higher rates of interest to cover the increased risks.

Nationwide has raised interest rates on deals above 75% by 0.2%.

Whilst this will hit first time buyers the hardest, it is a logical decision in the face of a faltering property market; building societies are not charities, they have as much right to make a profit as any other financial institution.

The increase in rates will also penalise existing customers, who have mortgages over the 75% threshold, and who are looking to remortgage. Statistics indicate that the average deposit in the UK is 20%.

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High Noon

Today marks high noon for the banks, as the the much vaunted court case begins that will determine the legality and fate of bank charges for unauthorised overdrafts.

The Office of Fair Trading (OFT) is seeking to prove that bank charges fall under the remit of consumer contracts regulations, which state that "penalty fees" must be proportionate to their cost. The banks claim that the charges, of £30 for bouncing a cheque or exceeding an overdraft limit, are not punitive and so do not fall under the terms of the act.

In the event that the OFT wins, it will begin a second case aiming to prove that fees levied on customers are too high because they exceed costs of £4 a transaction.

If the banks win, they will continue charging customers with impunity.

However, in a perverse twist, whatever the outcome of the case customers can still claim back late payment fees on credit cards of more than £12.

The banks going to court today are Abbey National, Barclays, Clydesdale, HBOS, HSBC, Lloyds TSB, Royal Bank of Scotland Group and the Nationwide Building Society. They have every reason to fight, as they make around £3.5BN per annum from these charges and stand to repay consumers £5BN if they lose.

However, whatever the outcome, you can be assured that the hapless consumer will be charged one way or another by the banks.

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Bank Charges

As the date for the court appearance by eight banks, who will be taken to court in January by the Office of Fair Trading (OFT) for allegedly unfair bank charges, draws ever nearer; some banks are trying to show "some flexibility" in their approach to their customers.

Thisismoney reports that Lloyds will be the first bank to reduce its overdraft charges.

Quote:

"On November 2 Lloyds will introduce a monthly charge of £15 and a sliding scale of daily charges of between £6 and £20 instead of its previous daily charge of £30 for unauthorised overdrafts."

Whether this mollifies the OFT, or is the start of a price war between the banks, remains to be seen.

The list of shame includes; Lloyds, Abbey, Barclays, Clydesdale Bank, Natwest and its owner HBOS, HSBC, The Royal Bank of Scotland and Nationwide Building Society.

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Hacking Threat To 5 Million PC's

Research, carried out by the government, indicates that around 5 million UK home computers are open to criminal attack.

"Internet Safety: The State of the Nation" has been published on the government's website www.getsafeonline.org.

The research shows that UK PC owners are making fundamental errors, that expose them to hacking and identity theft.

Tony Neate, managing director of Get Safe Online said:

"Protecting your home PC is a basic part of being safe and secure from the threat of criminal activity on the internet.

The fact that there are millions of households where the virtual backdoor is left wide open for criminals is a real concern – these people risk not only losing their own personal and financial information, but also put others at risk if criminals are able to access an innocent user's PC or internet connection. None of us would ever leave home without locking our doors and windows; by taking a few simple steps we can all ensure that our computers' doors and windows are automatically 'locked' every time they are switched on."

The research found that:

• 36% of the UK's 13.9 million home internet-connected PC users – 5 million machines – do not have any form of firewall stopping hackers from gaining access to their computers and using personal information.



• 46% do not have anti-spyware software.



• 35% of home PC users said they do not download updates from Microsoft or Apple to ensure that their machines have the latest security updates.



• Over 10% of the 9 million broadband users in the UK do not have a firewall on their home PCs.



• 21% households that use wireless broadband for their PCs say that they do not have password protection on their connections. This means that criminals could "take over" their internet connection and use it to send thousands of spam emails, posing as the legitimate user.



• 25% of home PC users do not have anti-spam programmes which would protect them from "phishing" attacks and other email frauds.



• Almost 1 million home PC users do not have anti-virus software on their machines.

Nick McGrath, Microsoft and Get Safe Online spokesperson, said:

"Governments and businesses are working tirelessly to counter online security threats but the reality is we're dealing with criminals who use ever more sophisticated methods to attack computers.

Regardless of security measures that have been pre-installed, entirely new and complex threats will continue to emerge.

Prevention is the best defence! For many people today, a PC is increasingly becoming a vital investment for the home and as long as some basic measures are taken from the moment of boot-up and throughout its life-time, it can remain that way."

You have been warned!

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Banks' Behaviour Unacceptable

The Information Commissioner has publicly accused banks, that have left customer details in the street, of an 'unacceptable' breach of the Data Protection Act.

It seems that the ever popular banks, who provide their customers with such "value for money", have been leaving customer account details in waste bins, skips and bin bags outside 11 branches across the country.

Needless to say this exposes the hapless customer to identity theft and fraud.

Deputy Information Commissioner David Smith said:

"It is unacceptable for banks and other organisations to carelessly discard their customers.

It is vital that banks and other organisations take security seriously. If they do not, they not only risk further action from the Information Commissioner but also risk losing the trust of their customers.

Individuals must feel confident that banks and other organisations are safeguarding their personal information."

The 11 financial institutions that have been named and shamed are:

-Halifax-Bank of Scotland
-Barclays
-Alliance & Leicester
-Royal Bank of Scotland
-NatWest
-Nationwide Building Society
-Co-operative Bank
-HFC Bank
-Clydesdale Bank
-Scarborough Building Society
-United National Bank

Also on the list were the Post Office and the Immigration Advisory Service.

The information publicly discarded by the banks included; names, addresses and bank account numbers.

Nigel Evans MP, chairman of the All Party Parliamentary Group on Identity Fraud, demanded heavy fines for the organisations involved.

Quote:

"It is absolutely unforgivable that these financial institutions have acted so irresponsibly.

They seem to have ignored warnings about the need to keep customer details secure. Quite frankly, I am amazed that this is still going on. It is well known that criminals actively target bins in search of this sort of detail. This behaviour shows a cavalier disregard towards the protection of customers."

The Information Commissioner's Office has asked the banks and other organisations to sign a formal undertaking to abide by the Data Protection Act in future. If they fail to do so, they would face action leading to prosecution and fines.

The British Bankers' Association said:

"Banks take their responsibilities for protecting customers' personal information very seriously and each bank has secure arrangements for disposing of confidential customer information.

The banks concerned have fully investigated the circumstances and taken appropriate steps to ensure that any weak links in their security practices have been addressed."

The statement by the Bankers' Association is of course contradictory, what is the point of having secure arrangements if they are not followed?

Pretty pathetic really, it hardly leads one to conclude that the high fees that banks charge for their "services" are justified.

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Free Financial Advice

The government will offer every adult, living in the UK, free basic advice about financial products within the next five years.

A nationwide scheme will be promised today by Labour, which is aimed at addressing the British people's lamentable ignorance with regard to financial matters.

Otto Thoresen, the chief executive of Aegon UK, has been appointed to lead a task force to design the scheme.

The task force has to report their findings and recommendations by the end of 2007.

In theory, the free service will provide advice about transactions; ranging from mortgages and pensions, to investing in the government's Child Trust Fund and baby bonds.

The theory is that there will be a national helpline, much like the NHS helpline, a website and network of new/existing local advice centres. The scheme will link to independent financial advisers and product providers.

The estimated £50M a year cost to run the scheme will be shared by the taxpayer and the financial services industry.

Ed Balls, Treasury minister, is quoted in the FT as saying:

"Financial decisions are difficult. Financial products are complicated and there is too much jargon. This puts people off, or they can end up buying something that is not right for them."

Maybe as an "add on", the government should also educate school children in financial basics? That way the problem is addressed from both sides.

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