Written by So, can anyone tell me how this works? Bet your life that the government won’t lose out – but taxpayers and shareholders will.
“I don’t have shares in any of the banks so it won’t affect me” you might think…if you have a private pension, think again. Your pension fund will have been invested in many different shares and you can bet your bottom dollar that banks and other financial institutions feature heavily.
You will notice that so far none of our insurance companies have gone down the toilet – and they are governed by the same financial regulator as the banks – the FSA.
Having worked in the insurance industry for ten years, I know just how regulated the industry is. Pity the FSA didn’t apply the same thinking to the banking sector. As soon as loans were being issued for more than 100% of the value of the item they were purchasing, the FSA should have stepped in and stopped the practice.
I know that x amount of insurance companies investments have to be in “safe” things such as government bonds – this is to ensure that if every single policyholder were to make a claim, there is money available to pay those claims immediately, and to ensure that not all money is gambled on the stock market.
Now the shareholders in all these banks will get a raw deal as the government will be first in line to see any profits – guarantee that as taxpayers we will not see the benefit of that – we will only be left with dwindling pension funds.
Once again this Labour government screws us over through their own incompetence and inability to enforce decision making in a regulatory body – this time the Financial Services Authority.
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