The Financial Conduct Authority says there will be an investigation into the way details of its inquiry into life insurance schemes were made public.
Shares in some of Britain's biggest financial institutions fell sharply in the wake of the announcement that it would look at whether some policies set up between the nineteen seventies and 2000 still represented good value for money.
This stockmarket episode started out with major criticism of insurance companies' charges for old pension and endowment policies and news that the Financial Conduct Authority would launch an inquiry. It ended with a major embarrassment for the City watchdog itself -- with the authority being forced to launch an investigation into the way it had handled the announcement.
The authority had briefed the Daily Telegraph -- the resulting story suggested there would be action to give millions of savers a better deal, so share prices in insurers plummeted, some down 16 per cent at one point.
Furious insurance industry chiefs complained that a disorderly market had been created -- the Authority then published a statement saying talk about cutting the charges was overblown.
The investigation into the way the matter has been handled will in part be carried out by an external law firm. It's the first major setback for the authority since it started work last spring.
Showing posts with label shares. Show all posts
Showing posts with label shares. Show all posts
Friday, 28 March 2014
Monday, 20 May 2013
Shares have returned over 50%
The FTSE share index has stepped up to its highest closing level for nearly 13 years, since September 2000 in fact.
What does it mean? In purely index terms, it looks like a very grim decade for share investors.
They still haven't reclaimed the ground reached in December 1999 when shares reached their all time peak, with the FTSE touching 6930, compared with 6755 today.
But the index number doesn't reveal the whole story, because anyone owning shares receives dividends - as long as the company is doing OK.
If those dividends were reinvested in the stockmarket as soon as they were received, the total return, as it's called, looks much healthier despite the credit crunch and financial crisis.
According to Adrian Lowcock from Hargreaves Lansdown, the total return since 1999 is 52.97%, even though the index is 2.98% lower.
Mind you, consumer prices have risen by 35% over the same period - but that's another story.
What does it mean? In purely index terms, it looks like a very grim decade for share investors.
They still haven't reclaimed the ground reached in December 1999 when shares reached their all time peak, with the FTSE touching 6930, compared with 6755 today.
But the index number doesn't reveal the whole story, because anyone owning shares receives dividends - as long as the company is doing OK.
If those dividends were reinvested in the stockmarket as soon as they were received, the total return, as it's called, looks much healthier despite the credit crunch and financial crisis.
According to Adrian Lowcock from Hargreaves Lansdown, the total return since 1999 is 52.97%, even though the index is 2.98% lower.
Mind you, consumer prices have risen by 35% over the same period - but that's another story.
Wednesday, 24 April 2013
Shares for TSB customers?
The collapse of Co-op's purchase of 632 Lloyds TSB branches throws up an intriguing new possibility - that the 4.6m customers of these branches could now become shareholders in their own bank.
And I wonder if they'll be offered shares at a discount or even as a windfall.
Why? The reason is that the route of selling the branch business, to be re-branded as TSB, to a rival has turned out to be a blind alley.
Instead, Lloyds says it will hive off TSB as a free standing company and sell shares in it to City institutions and the public.
The share sale or Initial Public Offering (IPO) was always a backstop but now it's the favoured option. It has to be because there's nothing else very attractive on the table.
How will the shares be offered? Well, dangling some of them, on give-away terms, in front of the noses of customers could turn out to be an cunning way of rallying them behind the sale and the new bank.
The Lloyds TSB customers affected by the divestment have a right to feel disgruntled about the whole process. 3.5 million have already been sent letters telling them that their bank is changing.
No one likes being treated like baggage. Lloyds says very few have opted out of the transfer so far, but they could get disenchanted once the real changes begin over the summer.
So why not offer the 4.6m cut-price shares in their own bank?
And remember, when the original TSB was demutualised and sold off in 1986, people who bought the shares were given a loyalty bonus after 3 years of 1 extra share for every 10 held.
Lloyds says it's too early to say how the sell-off will be organised, but giving new TSB customers something to celebrate when the day comes could be a canny tactic.
And I wonder if they'll be offered shares at a discount or even as a windfall.
Why? The reason is that the route of selling the branch business, to be re-branded as TSB, to a rival has turned out to be a blind alley.
Instead, Lloyds says it will hive off TSB as a free standing company and sell shares in it to City institutions and the public.
The share sale or Initial Public Offering (IPO) was always a backstop but now it's the favoured option. It has to be because there's nothing else very attractive on the table.
How will the shares be offered? Well, dangling some of them, on give-away terms, in front of the noses of customers could turn out to be an cunning way of rallying them behind the sale and the new bank.
The Lloyds TSB customers affected by the divestment have a right to feel disgruntled about the whole process. 3.5 million have already been sent letters telling them that their bank is changing.
No one likes being treated like baggage. Lloyds says very few have opted out of the transfer so far, but they could get disenchanted once the real changes begin over the summer.
So why not offer the 4.6m cut-price shares in their own bank?
And remember, when the original TSB was demutualised and sold off in 1986, people who bought the shares were given a loyalty bonus after 3 years of 1 extra share for every 10 held.
Lloyds says it's too early to say how the sell-off will be organised, but giving new TSB customers something to celebrate when the day comes could be a canny tactic.
Monday, 6 February 2012
Diamond share price rise or paste?
What has the Queen done with our shares in 60 years?
The FT30 share index, the oldest one in the world, stood at 115.8 in 1952 and it closed at 2009.4 on Friday.
That's a big rise. It has multiplied by 17 times, or risen by 1,600%.
However, as far as I can see, prices as measured by the Retail Prices Index or RPI are 23 times higher than in February, 1952.
That's a 2,300% increase. Not so good.
One thought, though, the FT30 index rise doesn't include the dividends you would have earned in that time.
Add in dividend income over 60 years and you'd be well in the money.
The FT30 share index, the oldest one in the world, stood at 115.8 in 1952 and it closed at 2009.4 on Friday.
That's a big rise. It has multiplied by 17 times, or risen by 1,600%.
However, as far as I can see, prices as measured by the Retail Prices Index or RPI are 23 times higher than in February, 1952.
That's a 2,300% increase. Not so good.
One thought, though, the FT30 index rise doesn't include the dividends you would have earned in that time.
Add in dividend income over 60 years and you'd be well in the money.
Friday, 23 September 2011
Sharp losses for savers and pensioners who depend on shares
The yo-yoing stockmarket is wreaking havoc with the savings of millions of people.
A typical pensioner retiring today on a personal pension will get 14% less than he or she would have received at the beginning of January.
A small investor who had put away money in a tax-free shares ISA has seen the value of the investment drop by 12%.
Figures complied for the BBC today show the impact of gyrating share prices on savers who have hitched their wagon to shares.
A 65 year-old who had saved £100,000 in a personal pension pot would use the money to buy a retirement annuity, a guaranteed income for life.
But the pot has dropped in value to £91,840 since the start of the year. So the prospective annuity income has fallen from £6,497 to £5,571, a cut of 14% in 9 months.
More than 400,000 buy annuities each year.
A saver who held £10,000 in a shares ISA is likely to have seen its value slip to £8,777, based on the average value of unit trusts which invest in a basket of shares.
HMRC tells me that 3.4 million investors subcribed for stocks and shares ISAs last year.
The figures come from pension experts, Hargreaves Lansdown, and the savings information group, Moneyfacts.
A typical pensioner retiring today on a personal pension will get 14% less than he or she would have received at the beginning of January.
A small investor who had put away money in a tax-free shares ISA has seen the value of the investment drop by 12%.
Figures complied for the BBC today show the impact of gyrating share prices on savers who have hitched their wagon to shares.
A 65 year-old who had saved £100,000 in a personal pension pot would use the money to buy a retirement annuity, a guaranteed income for life.
But the pot has dropped in value to £91,840 since the start of the year. So the prospective annuity income has fallen from £6,497 to £5,571, a cut of 14% in 9 months.
More than 400,000 buy annuities each year.
A saver who held £10,000 in a shares ISA is likely to have seen its value slip to £8,777, based on the average value of unit trusts which invest in a basket of shares.
HMRC tells me that 3.4 million investors subcribed for stocks and shares ISAs last year.
The figures come from pension experts, Hargreaves Lansdown, and the savings information group, Moneyfacts.
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