Northern Rock bailed out by Bank of England

Just logged in and took out 5k to pay my college fees, already done this in august but a holiday and a new kitchen means I had to go again. Don't think I would have bothered otherwise. Site was slow but worked. Don't see any point in taking the other 15K out at the moment as seems safe enough. NR share price seems to have rallied a little so maybe it will stabilise and give a little more confidence. I think it recovered about 25p this afternoon, still its less than half of what it was a couple of weeks ago. http://newsvote.bbc.co.uk/1/shared/fds/hi/business/market_data/shares/3/23193/intraday.stm
 
sapmanie said:
sadie PT14 You mean....there's no reason to panic!? :SHOCK: Who would have thought! ;-)
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Sapmanie, on Friday you were advocating the purchase of shares in NR. They were at 500p then, they are now at 290p. You were claiming deposits were safe and practically mocking those who are trying to withdraw their savings.
It's people's savings...they are the most risk averse of all. I would question the judgement of anyone leaves their money with NR. Only a tiny amount of it is completely covered (the average in each a/c is €100K), you forego the interest if the bank collapses and no doubt claiming your money from a Central Bank through a deposit protection scheme is laborious, time consuming and probably not instant.
There is not a single valid argument for keeping any money on deposit with NR. As to whether buying shares today is a good idea, who knows? I for one will not be.
 
Andy Doof said:
Sapmanie, on Friday you were advocating the purchase of shares in NR. They were at 500p then, they are now at 290p. You were claiming deposits were safe and practically mocking those who are trying to withdraw their savings.
It's people's savings...they are the most risk averse of all. I would question the judgement of anyone leaves their money with NR. Only a tiny amount of it is covered (the average in each a/c is €100K), you forego the interest if the bank collapses and no doubt claiming your money from a Central Banjk through a deposit protection scheme is laborious, time consuming and probably not instant.
There is not a single valid argument for keeping any money on deposit with NR. As to whether buying shares today is a good idea, who knows? I will not be.
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I agree with Andy Doof.

Perhaps, if we were resident in the UK, then the words of comfort coming from HM's Government and Bank would seem more real. The UK's levels of protection for depositers are also higher.

However, I am old enough to remember the debacles in AIB (no heads rolled!), NIB (guys should have been jailed!), PMPA (there is still a tax on insurance policies paying for this!), Goodman (then we later gave him back his company!) and other institutions going back to the 1980's when customers and taxpayers were screwed to pay for errors made by fat cat directors. The banks have driven the housing crisis here by abandoning previous constraints (e.g. 2.5 times income) with 100% mortgages etc. So why trust them with our deposits?

Also, never mind that previous Taoiseach who told me to tighten my belt in 1979 to pay fopr his Charvat account, our present Taoiseach is basically in the Dock, maybe not for corruption, but, for receiving tax free monies under the counter!

Get real! This is Ireland!
 
carpedeum said:
Perhaps, if we were resident in the UK, then the words of comfort coming from HM's Government and Bank would seem more real. The UK's levels of protection for depositers are also higher.
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As NR is regulated in the UK, the UK protection amounts also apply to Irish depositors.
 
Just exited the N.Rock building having queued from 08.45 today. Got a cheque. I wasn't willing to rely upon the electronic transfer that I had arranged on the internet. I still have to lodge the cheque of course, and it will take its usual several days to clear, but I just wanted to see the bit of paper in my hand! It was utter pandemonium towards the end, with people being squashed in the doors!
 
PetPal the queues in dublin seem terrible on the news, if people are still in the queue are they going to stay open?
 
Sky News reports that UK government has stated that they will guarantee ALL deposits held with NR.

It will be interesting to see if this calms the situation. It certainly makes me feel a little easier.
 
Wonder what effect it'll have;

http://news.bbc.co.uk/2/hi/business/6999615.stm

The government has said it will guarantee all deposits with the Northern Rock bank. The pledge by Chancellor Alistair Darling is an attempt to reinforce confidence in the beleaguered bank. More than £2bn has been withdrawn by customers since the bank applied for emergency funding from the Bank of England last week. Northern Rock shares were 40% down at one point on Monday and ended 35.4% lower as fears grow for its future.
 
Some people seem to be associating the value of Northern Rock shares with the safety of their deposits. Personally I think they have very little in common: the share price can be influenced by all sorts of things, and if it goes down it's not an indication of the state of the company's loan books.

I think the security of people's deposits (or lack of) needs to be assessed independently of the share price.
 
pc7 said:
PetPal the queues in dublin seem terrible on the news, if people are still in the queue are they going to stay open?
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Yes they assured us that they will stay open late (but that was after we were squashed!). When we did get in they had opened further rooms upstairs (it's very small there) and we were seen very quickly. The people who join the queue last will probably fend best.
 
Hi all, just got into NR online, "payment sent electronically to your bank" has appeared, I requested a same day electronic transfer on early friday morning. My balance is now showing as the funds withdrawn. Am very relieved, will be checking my PTSB intermittently to see when (fingers still crossed) they arrive. :)
 
carpedeum said:
I agree with Andy Doof.

Perhaps, if we were resident in the UK, then the words of comfort coming from HM's Government and Bank would seem more real. The UK's levels of protection for depositers are also higher.

However, I am old enough to remember the debacles in AIB (no heads rolled!), NIB (guys should have been jailed!), PMPA (there is still a tax on insurance policies paying for this!), Goodman (then we later gave him back his company!) and other institutions going back to the 1980's when customers and taxpayers were screwed to pay for errors made by fat cat directors. The banks have driven the housing crisis here by abandoning previous constraints (e.g. 2.5 times income) with 100% mortgages etc. So why trust them with our deposits?

Also, never mind that previous Taoiseach who told me to tighten my belt in 1979 to pay fopr his Charvat account, our present Taoiseach is basically in the Dock, maybe not for corruption, but, for receiving tax free monies under the counter!

Get real! This is Ireland!
Click to expand...

Brilliant post ; but was it not in the early eighties Charlie Haughey told us to tighten our belts / wear the hairshirt , while he was buying the most expensive of luxury shirts in Paris with his mistress ?
 
Folks

This thread has attracted a few users who are new to Askaboutmoney.

You are all very welcome, but please read the Posting Guidelines.

We do not discuss the value of shares on Askaboutmoney. I have had to delete a number of posts on this subject.

Brendan
Administrator
 
Has it been confirmed if this guarantee applies to non-uk accountholders?. I am just thinking of the Equitable Life situation when Irish policyholders didn't fare as well as their uk counterparts
 
Can anyone actually put forward a realistic scanario where depositors would actually loose their cash?

I would have thought that as a profitable company with a cash flow problem and a plunging share price, the most likely thing to happen is that they are taken over by a competitor or some new entrant. I've no doubt the vultures are already circling.

Am I wrong?
 
TSThomas
The government has said it will guarantee all deposits with the Northern Rock bank.

Wonder what effect it'll have?
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The effect is that some people may acuse you of being smug for saying right from the start that there was no need to panic. :(
 
ang1170 said:
Can anyone actually put forward a realistic scanario where depositors would actually loose their cash?
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Why bother- whats the value in that? How about if the UK was attacked with a nuclear bomb - the scenario does exist in reality - but why bother?

ninsaga
 
rabbit said:
Brilliant post ; but was it not in the early eighties Charlie Haughey told us to tighten our belts / wear the hairshirt , while he was buying the most expensive of luxury shirts in Paris with his mistress ?
Click to expand...

Yes think it was 1980. Those were the infamous Charvet shirts.
 
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