We are The voice
The BBA’s Chief Economist Rebecca Harding blogs about how the Bank’s quantitative easing is developing, and explains what impacts, if any, there will be following the rise in inflation.
In the latest blog from governance risk and compliance specialists Hitec, journalist Gaynor Pengelly explains why failure to gain the necessary data to accurately engage a customer can damage a relationship and lead them directly into the arms of the competition.
The BBA’s Financial Policy and Operations Policy Director, David Wren, blogs about what today’s consultation paper means for the UK banking sector.
Last week the BBA submitted its response to the PRA’s consultation on Pillar 2 proposals. Simon Hills, Executive Director, Prudential Regulation and Risk, blogs about the sectors’ views on the proposals.
BBA Retail Policy, Walter McCahon, blogs about the use of customer data and what it means for financial institutions.
Dr. Rebecca Harding, Chief Economist at the BBA talks about the Bank of Englands programme to buy Government bonds, quantitative easing and the housing market in this weeks blog.
Matt Peachey, Vice President & General Manager EMEA of Pindrop, blogs about the tactics used by fraudsters to steal customer data.
Kashif Khan, Accenture’s Core Banking Sub Practice lead for UK and Ireland, blogs about the digital opportunities within the unsecured lending market.
Simon Hills, Executive Director, Prudential Capital and Risk blogs about how the Bank of England’s decision to drop interest rates might impact the Leverage Ratio.
Commenting on the final findings of the CMA investigation into the supply of personal current accounts (PCAs) and of banking services to small and medium-sized enterprises (SMEs), chief executive of the BBA Anthony Browne said:
“Banks compete to attract and retain customers every day. They are also focused on giving their customers the best outcome for the services they provide. The CMA’s final recommendations will further help consumers with a package of measures which give individuals and businesses greater power to pick the products that are best for their needs.
“Customers and businesses have already found digital banking hugely convenient and have taken advantage of mobile technology that is allowing us to bank round the clock. We are pleased the CMA has reflected that in its recommendations.
“However, we recognise more work needs to be done to create a level playing field by supporting new banks wanting to set up business, as well as helping to grow established banks.”
Dr. Rebecca Harding, Chief Economist at the BBA, looks at the drop in the Bank of England base rate, why they took this approach and, more importantly perhaps, two of the challenges this approach faces.
The BBA’s Retail Policy Advisor, Iris Kapelouzou, blogs about what banks are doing to help blind and partially sighted customers, and what more can be done in the future.
Dr Rebecca Harding, BBA chief economist, said:
“The decision to cut interest rates and increase quantitative easing sends a clear signal that the Bank of England is taking a ‘whatever it takes’ approach to stabilising the economy. Weak post-Brexit data is creating a perception that the economy is likely to slow and the decision to reduce rates has been made on the basis of a perception of risk.
John Davies, CEO, The Just Loans Group PLC, blogs about how traditional banking and FinTech can work together to support customers
Simon Hills, Executive Director, Prudential Capital and Risk blogs about optimising business design for FRTB
Ahead of the Bank of England’s interest rates announcement on Thursday this week, the BBA’s Chief Economist Rebecca Harding blogs about the negatives of dropping interest rates.
This will be the last BBA Brief until early September 2016.
Industry awaits EBA stress test results
Later today, the European Banking Authority will announce the results of its latest round of stress testing of 51 European banks. According to the FT (£, p7), the most important element of the results will show how well banks’ capital can withstand worsening economic conditions and tougher regulation. Italy’s banks are predicted to fare the worst, in particular Italy’s third largest bank, Banca Monte dei Paschi di Siena, which is already trying to raise new capital, reports the BBC.
May Brexit talks commence with Slovakian PM
As part of her European tour to discuss Brexit negotiations, Prime Minister Theresa May met with Slovak Prime Minister Robert Fico in Bratislava yesterday. According to Reuters, Ms May stressed the need to have an open mind about a potential deal saying, “we should be driven by what is in the best interests of the UK and what is going to work for the European Union, not by the models that already exist.” Slovakia currently holds the EU Council presidency and has previously voiced concern over free movement and the rights of Slovakian nationals already resided in the UK, reports the London Evening Standard.
Jaywing’s Risk Practice Director, Ben O’Brien, blogs about approaches to the implementation of IFRS 9, and the solutions available that maximise integration and functionality.
Michel Barnier appointed chief of Brexit talks
The Telegraph (p6) reports that the European Commission has appointed former French Minister, Michel Barnier, as the chief negotiator for the U.K.’s exit from the European Union. Announcing the appointment, European Commission President Jean-Claude Juncker said he “wanted an experienced politician for this difficult job” (BBC). According to the FT (£, p5), Mr Barnier will oversee a commission task force as well as preparing formal exit talks under Article 50 once it is triggered.
UK challengers weather Brexit storm
Despite profit warnings from Bank of England earlier this month, the UK’s challenger banks have reported steady profits for the second quarter of 2016 (Telegraph, online only). Chief executive Steve Pateman of challenger bank Shawbrook told the FT (£, p18) “It [Brexit] doesn’t change our strategy at all…I think it would be an entirely wrong decision [to rein lending in],” he added. Craig Donaldson, chief executive of Metro, added that he had not seen a change in customer behaviour since the UK’s EU referendum, nor any impact on business flows. The news follows a report from the Bank earlier this month which suggested challenger banks were less shielded from downturns in the commercial property sector, reports City AM.
BBA High Street Banking statistics published
The Guardian (online only) reports that the BBA’s High Street Banking data for June showed that business borrowing dropped for the first time in 2016 last month, as UK companies delayed investment decisions until after the European Union referendum. Borrowing by British companies outside the financial sectors fell by £526 million in June, while house purchase approvals fell from 41,842 to 40,103. Rebecca Harding, Chief Economist at the BBA, said: “Overall, business confidence was clearly fragile in anticipation of the outcome of the vote, but these results are not a verdict on the health of the economy post-Brexit. We won’t start to see that data come through until the autumn and any trends before then should not be over-interpreted” (Telegraph, p30). The data was also covered by the Times (£, p43), City AM (p9), i (p41) and Evening Standard (p32).
FCA warns over long-term credit card debt
The FT (£, p2) reports that the Financial Conduct Authority has criticised credit card providers for making long-term profits from consumers who make minimum repayments rather than clearing their balances. UK borrowers now have £63 billion of credit card debt – up from £61 billion in 2014 – while almost one in nine card holders have balances it would take them more than a decade to repay. Joanna Elson, Chief Executive of the Money Advice Trust, called for more to be done to help indebted individuals (BBC News). Richard Koch, of the UK Cards Association, added: “The credit card industry will continue to engage constructively with the regulator in the coming months to ensure that effective and proportionate remedies are developed for these customers.”
Negative interest rates could hit businesses
The FT (£, p2) reports that a number of banks have inserted clauses into terms and conditions that would allow them to impose charges on businesses for keeping cash on deposit if interest rates fall into negative territory. Analyst Ian Gordon said: “If a bank chose to pay negative rates and lost a slug of deposits, the bank in question wouldn’t particularly care – what they’re currently looking at is surplus deposits which they cannot deploy in new loans because there is a lack of demand” (Telegraph, p27). The Federation of Small Businesses said the idea of negative rates is “deeply concerning.”
Financing Growth has been produced to help small to medium-sized businesses identify some of the different finance options that may be available to expand their business, including information, tips and Read More
As I suggested last week, UK Consumer Price Inflation (CPI) rose from 0.5 per cent to 0.6 per cent. On one level, the Bank of England will be pleased about Read More
First impressions count. Whether it’s a clever online marketing gambit or a superior ‘customer experience’, there’s only a small window of opportunity to engage with a new customer before they Read More