17 September 2008
UK-listed insurers had disclosed exposure to Lehman Brothers totalling nearly £500m at the time of going to press, with more expected to follow.
The special liquidity scheme could be making significant profits for the financial authorities, claims New Star chief economist Simon Ward.
The Association of British Insurers is calling on the FSA to allow those who are tied and multi-tied to fall under the advice category, rather than moving across to sales.
Usually, a spate of similar fund launches leads to criticism of marketing-led initiatives and accusations of jumping on a bandwagon by greedy providers. But the latest theme in the UK retail market - the introduction of absolute alpha funds to rival BlackRock's successful UK absolute alpha portfolio - has buyers, advisers and providers alike believing that more is better.
Maia Capital is planning to add fixed income and absolute return funds to its multi-manager suite.
A leading IFA has hit out at Lehman Brothers for continuing to peddle structured products in the days leading up to its collapse.
Britain remains a small market for offshore-domiciled mutual funds, according to the 2007 Investment Management Association annual survey, published last month.
Standard Life head of estate planning Julie Hutchison says that retrospective legislation changes made to inheritance tax must be flagged to protect financial advisers.
The Association of Independent Financial Advisers is calling for the creation of a sales sector that features both sales with and without persuasion as part of the retail distribution review.
AIG Life has assured advisers that clients, including Living Time policyholders, are protected from market uncertainty.
AIG Life has suspended withdrawals from its standard fund and the enhanced fund held within the premier access bond and the premier bond.
Private equity chief Alchemy managing partner Jon Moulton expressed grave concerns over AIG's funding structure at an evidence session before the Treasury select committee earlier this year, prompting some IFAs to stop recommending AIG linked products.
Alliance Trust Equity Partners has appointed Layla Fear as an investment manager.
The Association of Medical Insurance Intermediaries is planning to lean on the British Insurance Brokers Association and PMI providers to help it form a discussion panel focusing on the transparency of PMI claims.
The FSA has failed to do an adequate cost-benefit analysis of its treating customers fairly requirements, says the Association of Private Client Investment Managers.
The Scottish executive has slashed the farming subsidy of Artemis co-founder John Dodd by £107,000 over suspicions pesticides discovered on his Glenogil estate were used to posion birds of prey, according to press reports.
Aviva has revealed a £148m exposure to global insurance giant American International Group.
Every non-front-line public sector employee earning £100,000 or more should be forced to reapply for their jobs with greatly reduced wages and benefits packages, says LibDem Shadow Chancellor Vince Cable.
The Bank of England is to extend its Special Liquidity Scheme until 2009.
Bankhall chief executive Peter Mann is to leave the firm to take on the role of chief development officer at Skandia.
Barclays has acquired Lehman Brothers US investment banking and capital markets operations.
Barclays is understood to be raising £750m through a share placing to bolster its capital, say reports.
Everything I read or hear at the moment to do with the economy, the housing market or the stockmarket makes it sounds like the apocalypse is nigh. What should I do?
Compliance advisory firm The Consulting Consortium is launching its Serious Learning platform, offering training for advisers in strategy, sales, finance, IT and regulation.
FSA chairman Adair Turner has told the BBC that the regulator may force banks to hold more capital if they pay big bonuses that encourage excessive risk-taking.
The number of Personal Finance Society members who hold the chartered financial planner qualification has leapt by 50 per cent in the last 12 months.
BlackRock UK absolute alpha fund manager Mark Lyttleton says the FSA’s decision to ban short selling of financial stocks will restrict the fund in the short term.
BM Solutions could be the first of the HBOS brands to be cut in the wake of the Lloyds TSB buyout, says Ray Boulger.
A few decades ago, the traditional view was of pipe and slippers by the fireside, an unexciting and boring existence. As we grow older, our views naturally change but it seems that society is shifting dramatically as well.
The FSA has banned Southall mortgage broker Asim Hussain for submitting false mortgage applications to lenders on behalf of himself and customers.
Independent mortgage broker Danny Lovey has branded the UK regulatory regime ‘pathetic’ for allowing short sellers to bring HBOS almost to ruin.
Do you think that the Government should help fund the mortgage market?
The Prime Minister Gordon Brown has pledged to rebuild the global financial system on clear principles in his speech to the Labour conference in Manchester.
As investors have shunned the sector over the last year amid negative sentiment and lack of available and affordable credit, total returns have taken a pounding. A correction in the real estate market was long overdue but the speed of the decline was nonetheless surprising.
British Insurance has unveiled plans for an insurance product to help people living in rented accommodation meet their monthly payments.
IFAs have been warned to be careful when encouraging clients to exploit tax loopholes.
The US government's dramatic move to take over giant mortgage lenders Freddie Mac and Fannie Mae, which secure three-quarters of all mortgages in the US, is being hailed as an example for the British Government to follow.
Banks have been challenged on their claims that repossession is always an action of last resort by the LibDems Shadow housing minister Lembit Öpik.
Chancellor of the Exchequer Alistair Darling is expected to override the Office of Fair Trading and the Competition Commission to allow a deal between Lloyds and HBOS to go through.
Checkmate Mortgages has appointed two non executive directors in anticipation to its forthcoming launch.
A City of London IFA has warned that the absense of City bonuses will have a big effect on the London and Greater London housing market.
Liberal Democrat leader Nick Clegg has attacked the immorality of banks who lent money "hand over fist" to vulnerable consumers in the run-up to the credit crunch.
Kohn Cougar managing director Roddy Kohn has urged caution about mergers driven by stock market speculation not business fundamentals and says it will damage consumer choice in the long term.
The potential creation of a giant life player through the merger of Lloyds TSB and HBOS could be tough competition for other UK life companies, analysts Keefe, Bruyette & Woods have warned.
Confusion is heightening over Blue Sky's structured products as Lloyds TSB enters into advanced merger talks with UK’s largest mortgage lender HBOS.
There are times when writing this column becomes an exercise in serendipity. A classic example came this week, when I received a call from Saran Allott-Davey, a financial adviser who runs Heron House Financial Management in Newport.
Hargreaves Lansdown head of pension research Tom McPhail has warned pre-retirement investors may have to defer retirement if they have not yet de-risked their portfolio.
UK investors woke today to more shock waves in the financial sector with the announcement that HBOS was entering into advanced talks with Lloyds TSB about a possible merger.
Prior to getting married, a cynical but wise man told me that the three most important words a married man can repeat in times of difficulty with his spouse are: "You were right." This level of compliance is possibly best described as a tactical withdrawal. Often, this will occur when the male is totally unaware as to the reasons for his difficulty. However, this level of ignorance is not healthy in any relationship and honesty is more effective in the long run, provided you can take the heat.
The turbulent climate that is challenging our industry is not going to be resolved for some time, a message that was reinforced in Sir James Crosby's interim mortgage finance report.
The irrepressible Doug Brodie of Master Adviser comes on the phone this morning. Doug is famous for asking awkward questions. But he suggests I ask some too.
Money Marketing's newly launched Time To Get Personal campaign aims to ensure the problems of personal accounts are not overlooked against the stormy economic climate.
When precipice bonds went wrong, part of the problem was the fact that the bond provider tried to borrow the halo of financial strength from the big provider supplying the underlying contract. This proved to be a very bad idea indeed.
ETF Securities has announced all 113 of its ETCs that are backed by AIG have now resumed trading.
Former St James's Place chief executive Mark Lund is to take over as group chief executive of Money Portal.
F&C Investments has announced the appointment of Oliver Sonnbichler as a fund manager within its multi-manager team.
Complaints to the Financial Ombudsman Service over non-disclosure are falling as a result of the guidance paper drawn up with the Association of British Insurers in January.
The US government's bailout of Freddie Mac and Fannie Mae has restored some market optimism but financial stability remains uncertain, says AWD Chase de Vere.
The US government's bailout of Fannie Mae and Freddie Mac has done little to improve the US housing sector and has potentially lethal consequences, claims asset management firm Whitefoord.
The FTSE 100 rose steeply this morning, rising 7 per cent in early trading to 5,218, in reaction to news that the FSA has banned short selling of financial stock.
Fitch Ratings has said there is no guarantee that Lloyds TSB’s takeover of HBOS will restore creditor confidence due to the volatility of the market.
Five more providers have joined Assureweb’s equity release comparison service bumping its total up to 15.
Ombudsman Melissa Collett says it is a myth that many applicants deliberately lie about their health, knowing they are going to make a claim on their policy.
Friends Provident, Aegon and Aviva have revealed a combined £499m exposure to Lehman Brothers since the failing bank filed for bankruptcy on Sunday.
CMS Cameron McKenna says the FSA may take enforcement action against firms whose handling of payment protection complaints falls short as PPI complaints skyrocket at the Financial Ombudsman Service.
The Financial Services Authority has banned the active creation or increase in net short positions in listed financial companies from midnight tonight.
The FSA has reportedly begun contacting rival banks asking them if they are interested in acquiring Bradford & Bingley.
In the front-page article regarding the non-payment to commission-based advisers by agency Gfk, an FSA spokesman is quoted as saying there was "no facility to remunerate commission-based advisers because no business was put through".
The FTSE 100 has fallen by almost 3 per cent today amid concerns over what shape the US government’s $700bn financial bail-out would take.
The FTSE 100 index closed a record breaking 8.8 per cent up today on the back of news that the US government has pledged to spend big to clear up bad debt hitting the global economy.
GE Money has allayed fears that it is set to be the next US intermediary lender to exit the UK market.
GE Money has made urgent changes to its First National and IGroup brands.
Soap opera storylines, social networking and Government-led initiatives are three suggestions put forward to boost income protection sales and close the £2.3trn protection gap.
Gissings Advisory Services has rebranded to become Enrich Reward Limited following an £18m management buyout at the end of last year.
Goldman Sachs and Morgan Stanley are ‘much less likely’ to fall following today’s action from the world central banks to boost liquidity, says New Star fund manager Ian Beattie.
The investment bank became extinct today as both Morgan Stanley and Goldman Sachs became holding banks.
There was a warning recently that if the "price war" in protection continues, more insurers may be forced to exit the market.
Trade and investment minister Lord Digby Jones has called on UK investors to continue looking at Bric countries but also widen their horizons to new areas such as Vietnam, Mexico and Ukraine.
The retail distribution review has once again directed debate towards the quality and value of advice.
The Alternative Investment Management Association has rejected calls for a ban on short selling of bank stocks in the wake of a merger between HBOS and Lloyds TSB.
Chancellor Alistair Darling's stamp duty holiday on homes priced up to £175,000 has received a mixed reception.
The nationalisation of US mortgage giants Freddie Mac and Fannie Mae has sparked hopes that a global housing market recovery could be on the horizon.
The IMA chairman Robert Jenkins has called for regulators to tackle the issue of leverage in the credit crunch.
The reputation of exchange traded funds took a blow on Tuesday as the London Stock Exchange suspended trading in 113 instruments offered by ETF Securities.
IFG Group is combining its two Sipp and SSAS provider companies under one firm called IPS Partnership.
The Investment Management Association has warned its members to “carefully consider” the implications of any participation in the lending stock of UK banks due to current market conditions.
The Intermediary Mortgage Lenders Association has hit out at the Bank of England’s madness to exclude the Special Liquidity Scheme from many intermediary mortgage lenders.
A new report from Informed Choice has found that nearly £30bn of investors money is now sitting in ‘lemon’ funds.
US equities are set for a renaissance as global markets stage a recovery over the next year, predicts M&G fund manager David Jane.
Keydata Investment Services has clarified to IFAs that it does not have any relationship with bankrupt investment firm Lehman Brothers.
Legal & General has unveiled its plans to increase its financial underwriting limits for life insurance and critical illness cover.
The chairman of the Financial Services Consumer Panel Lord Lipsey says the FSA is listening to calls for the Retail Distribution Review to create a middle ground between the strict sales and advice distinctions outlined in its interim report.
Pension minister Mike O'Brien has argued the "wild claims" about the number of people likely to lose out under personal accounts are unlikely to hold up to scrutiny.
Lehman Brothers’ administrators PricewaterhouseCoopers have secured funding to pay 4,500 UK employees their September wage packet.
Members of the Lehman Brothers' pension scheme may be forced to claim on the Pension Protection Fund after administrators said the scheme was "significantly deficient."
Liberal Democrat shadow chancellor Vince Cable has called for the FSA to stop hedge funds short-selling HBOS shares following its stock market plunge.
Liberal Democrat leader Nick Clegg has unveiled the party’s Fairer Future economic recovery plan in his closing speech to the party conference.
London Interbank Offered Rates reached a seven-year high this morning in the wake of market turmoil over the last 36 hours.
Lighthouse Group has reported a drop in gross profits of 8 per cent to £7.6m in the six months to June 30, down from £8.3m in 2007.
Lloyds TSB has revealed that it has bought HBOS for £12.2bn.
Forgive me for asking but someone has to. Is it really necessary to fasttrack a merger between HBOS and Lloyds TSB?
Wealth Manager London & Capital have added a new issue to its structured product range.
The London Stock Exchange has lifted the trading suspension on a number of AIG-backed ETF securities.
Maia Capital partner Jason Collins says his firm is unlikely to follow some of its multi-manager peers by increasing its cash holdings.
Friends Provident chief executive Trevor Matthews says he gets upset over the poor regard for the insurance industry.
The Association of British Insurers and Financial Ombudsman Service have failed to agree on whether requiring all applicants to provide complete medical information is a practical solution to preventing non-disclosure on protection products.
The nationalisation of Fannie Mae and Freddie Mac in the US had no significant impact on UK interest rates.
Morgan Stanley is looking at the possibility of merging with another bank following the recent market volatility, according to CNBC
Market speculation regarding the potential merger between HBOS and Lloyds TSB has led to mortgage brokers expressing concern about potential competition damage.
The face of mortgage distribution is set to change dramatically as more networks and clubs begin to merge.
PSigma income manager Bill Mott believes we are not facing economic Armageddon but are in the midst of a normal economic slowdown.
The Treasury select committee is calling for a new committee to be established to control the Bank of England's financial stability functions.
HSBC Global Asset Management is to launch a Middle East and North Africa fund in October under the management of Andrea Nannini.
NDF and DRL have warned investors in their structured products underwritten by Lehman Brothers that they should prepare themselves substantial financial losses.
PricewaterhouseCoopers has confirmed that Nomura is to acquire the UK and European investment banking and equities businesses of Lehman Brothers.
The £500m business protection gap could be closed if more advisers understood the product, claims Norwich Union director of protection Trevor Bailey.
As autumnal deluges continue to wash the final tiniest lustre of summer from the UK's beaten spirits, it is hard not to see the weather as a metaphor for our beleaguered state. Thank goodness that the Olympics at least injected a temporary state of ebullience into the nation.
A well-known Californian politician and former Hollywood movie star has revealed he is set to buy Lloyds TSB, Abbey and Royal Bank of Scotland and create a bank “bigger than anyone could imagine”.
Among the plethora of research documents spinning out of the investment banks, signalling that analysts are back from bucket and spade duty, has been a note suggesting that the market corner has been turned. This is no ill-considered bullish rant but rather a piece of reasoned strategy assessment looking at how corporate profitability might fare in the US. Goldman Sachs, the author of the report, believes that the nadir of the earnings' cycle will be reached in the first quarter of 2009. ...
Financial technology company Kublax has set up a free online service to help people manage finances.
This week, I am revisiting a fund I highlighted in March - M&G optimal income. Its story gets stronger each week, and judging by Richard Woolnough's comments in last week's issue, so does he.
The Professional Mortgage Packagers Alliance has announced that it is to close from 30 September 2008.
Last week, I looked at what constitutes a transitional serial interest. One such interest would be one appointed before October 6 under a pre-March 22, 2006 interest in possession trust.
Total permanent disability has long been an area with a high percentage of declined claims in the critical-illness cover market. Although only around 3 per cent of all critical illness claims are made under TPD, the declinature rates are more than 55 per cent.
Jersey-based investment manager Ashburton is part of FirstRand Group, one of South Africa's biggest financial services companies but little known in the UK. This is one of the things that managing director Peter Bourne intends to change.
The Personal Finance Society has established a working party of pension experts to lobby HM Revenue & Customs for greater clarity on Qrops regulations following months of uncertainty.
LibDems have called for an end to the mass means-testing of pensioners.
A significant amount of money is held in existing trusts and the trustees will want to invest this money in a way that produces the best return for the beneficiaries without contravening their legal duties.Pooled investments such as collectives and single- premium investment bonds can play an important role because of their tax-saving qualities but the tax rules have recently changed.
You can’t help but feel some sympathy for the Liberal Democrats. No matter how hard they try to grab the headlines something always seems to rain on their parade.
Leading portal providers have recorded a steady growth in online quotations, according to a report issued by consultancy firm AT8.
Variable annuity providers will suffer as the price of derivatives rises, predicts Hargreaves Lansdown head of pension research Tom McPhail.
If the UK protection market continues to be driven by a focus on price do you think there is a danger of reinsurers pulling out of the market? What would happen to the UK protection industry if a number of reinsurers do pull out?
Paymentcare.co.uk has slammed the latest PPI survey by Which? for tarring all payment protection providers with the same brush.
Advisers are split over the potential impact of the Lloyds TSB and HBOS merger on the protection market with some saying it could spur on innovation while others suggest it will make no difference.
Legal & General is encouraging consumers to review their protection needs to reduce the level of unprotected debt.
PricewaterhouseCoopers, the administrators in the Lehman Brothers bankruptcy case have called for patience as it tries to untangle the investment firm’s interests.
PricewaterhouseCoopers says it is now in talks with one buyer for the UK and European investment and private equity businesses of Lehman Brothers.
Lehman Brothers’ administrators PricewaterhouseCoopers says it is facing “unprecedented uncertainty and complexity” in its efforts to deal with the banks’ affairs.
If the purpose of the new personal accounts is to improve people's income in retirement, then I think it is wide of the mark. Surely the simplest way to achieve this would be for the Government to increase the basic state pension to a level which is sufficient for people to live on and increase National Insurance contributions to fund it.
Lowes Financial Management has attacked credit rating agencies which failed to downgrade Lehman Brothers.
Reita has called for the FSA's ban on short-selling to be extended to both the commercial property and real estate sectors.
Axa Investment Management has restructured its fixed income division by splitting it into two separate teams.
RGA is the latest reinsurer to be left exposed to US investment bank Lehman Brothers and insurance giant American International Group, disclosing a combined exposure of £50.6m.
Insurance firm RSA is reviewing whether to move its headquarters offshore due to the UK tax regime.
The Russian stock exchanges have had to stop trading due to a sharp surge in stocks within an hour of reopening after their last suspension.
Trading on Russia’s major stock markets has been suspended for a second day after shares nose-dived on the back of the Lehman Brothers collapse.
Standard & Poor's has placed AA-rated Scottish Widows and Clerical Medical on credit watch with developing implications and lowered A-rated St James’ Place from positive to developing.
The administrators which oversaw the Enron saga say that the Lehman Brothers' bankruptcy is bigger and more complicated.
Savills has bought a mortgage packager and renamed it Savills Lending Solutions and says there could be further acquisitions on the way.
Whitechurch Securities has unveiled a retirement solution that will pass on up to 80 of renewal income to IFAs when they retire.
Safe Homes Income Plans has attacked Which? for it’s “outdated views” towards equity release.
We all knew the hedge fund industry wouldn’t accept the new short selling rules without a fight and some are now threatening to sue the FSA for millions of pounds in losses.
Simply Biz has acquired the total share capital in Simply Biz Mortgages and Broker Support Services for an undisclosed sum.
Simply Biz has announced its plans to put a freeze on membership costs next year.
Skandia says its Spectrum range of funds has reached £50m since launch in April.
St. James’s Place chairman Mike Wilson says he has had no contact with Lloyds TSB following its recent takeover of HBOS.
BNP Paribas is launching the first two funds under the Privalto UK brand.
Standard Life is increasing the recurring commission available to IFAs and advisers on its existing life bond products.
Blue Sky Asset Management has breached the capital protection level of its first structured product following falls in the UK stockmarket, leaving investors' capital at risk.
The Investment Management Association has sparked a debate on the transparency of structured products after it hit out at the lack of performance information and suggested that claims made in some marketing literature should not be taken at face value.
Swip has the edge over Insight should a consolidation of the fund management businesses take place, that’s according to AWD Chase De Vere head of investment research Justine Fearns.
Swiss Re has disclosed a £25m exposure to Lehman Brothers and £100m to insurance giant American International Group.
Tenet has sent a statement out to its advisers warning that some Lehman backed structured products may not be covered by the FSCS.
Many IFAs will be looking at retirement in the coming years, indeed the statistics suggest that around a quarter of all IFAs are likely to consider retirement over the next five years - assuming they can afford it.
Only a year ago, there appeared to be attractive investment opportunities in a myriad of sectors and locations. Since the credit crisis began, however, the landscape has shifted dramatically.
A recent setback on the Russian stockmarket has been fuelled by the war in Georgia and some falling commodity prices. I see this as a great buying opportunity because Russian president Dmitry Medvedev has said he does not want a cold war and commodity prices are likely to continue their upward trend in the long run.
Bloomsbury Financial Planning partner Jason Butler has warned that the FSA’s intervention to prevent short-selling in bank stocks will prolong a necessary purging of the markets.
Unless a person wants someone else to decide what happens to their assets when they die, it is important to write a will.
To intervene or not intervene? That is a question that has dominated political theory over the last century and it applies as much to economic policy as it does to social policy.
IFAs have hit out at providers for overloading them with telephone surveys.
True Potential has signed up its 100th firm since it launched in March 2007.
Two people have been charged with 17 counts of insider dealing at the City of Westminster Magistrates Court today.
The number of people in Britain claiming unemployment benefit is rising at its steepest rate for 16 years.
Troubled insurer AIG was thrown a lifeline overnight as the US Federal Reserve announced an $85bn loan to save the business from bankruptcy.
The U.S. Treasury Department has promised “hundreds of billions” to save the US markets using its own reserves.
The plans to be set out by the US Government to comprehensively change the financial markets may include a restructuring of mortgages in the USA.
I always approach any new financial product with a very simple premise - would I buy it?
Distributors and product providers will all be sharing client data using virtual tools by 2020, according to Friends Provident ecommerce manager Steve Young.
West Bromwich Building Society has opened a sales academy for its staff as it looks to raise the standard qualification of its salesforce to diploma level.
Contagion. It is almost as if we say the word so glibly these days that we forget what it means.
The furore north of the border about the prospect of English and Scottish footballers playing alongside each other in an Olympic Team GB squad has put the spotlight on an issue likely to be lurking in the minds of many IFAs - what would an independent Scotland mean for financial services?
Why are product providers so unsure of our roles? Surely when an IFA client is involved, the product provider's role is to provide the product and the service relating to that product and ours is to provide advice to the client?
Witan investment trust has appointed James Frost as managing director and marketing director.
Invesco Perpetual income guru Neil Woodford has been appointed lead manager of the £1bn Edinburgh investment trust, with analysts predicting that he could adopt the style of his higher-income fund.