Give me banking stability
“So where do you keep your money then Mike?” was the question posed to me by one of the MD’s with whom I work after the news broke about Bradford & Bingley recently.
“I expect you’ve found some tax-efficient, safe as houses place?” I think she was a bit disappointed by my response that actually my accounts were with UK High Street names (although with Lloyds TSB and HBOS coming together I might have to look at making some changes, depending on what happens to the Financial Services Compensation Scheme limits).
Disappointed? … probably more reassured actually that I shared her feelings about all the turbulence that we’ve gone through in recent months and which shows little sign of abating.
A feeling of inevitability, that the ever upward spiral of house prices, the seemingly “open chequebook” approach to lending was sooner rather than later going to go horribly wrong but that the traditional conservative approach adopted by some of our financial institutions would see them come through stronger in the end.
So we are likely to see a period of consolidation in the industry – much like has happened in the TV industry – replacing a multitude of institutions all competing aggressively for our business.
Fears of a lack of competition? Maybe, but I think I’d rather live with that in order to regain financial and economic stability in the medium term.
