News Summary: 08 March

Mar 8, 2013   //   by Keith McDonald   //   Breaking News  //  Comments Off on News Summary: 08 March

A round-up of the main news stories from this week.

Taxpayer-Backed Banks Make Most Severe Lending Cutbacks

Big banks supported by the taxpayer were among those to make the most severe cutbacks in lending in the second half of 2012. Figures from the Bank of England showed that Lloyds and RBS joined Santander in reducing net lending by several billion pounds. This is despite a government scheme offering cheap funds to banks to persuade them to lend to households and businesses.

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Payday Lenders to Face Stricter Rules from OFT

Payday lenders are to face stricter rules following a year-long review by the Office of Fair Trading. The OFT has warned firms to raise their game if they want to keep their licenses. The regulator wants more transparent marketing and a crackdown on the practice of “rolling-over” loans, which can carry annual interest rates of several thousand percent.

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RBS SignRBS Glitch Leaves Customers Stranded

RBS has apologised after a glitch left customers without access to cash and their online accounts on Wednesday night and Thursday morning. It is the third time in under a year that the group has been struck by a technical hitch. Problems last June left customers stranded for days after a routine software upgrade went wrong. The bank said it would consider compensation for the latest outage on a ‘case-by-case’ basis.

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Barclays Pays 428 Staff over £1 Million in 2012

Barclays paid 428 of its staff over £1 million last year, and 5 of its staff over £5 million, despite being caught up in a wave of scandals. The bank’s annual report also showed that over half its workforce took home less than £25,000. The details are part of a new wave of transparency ordered by Barclays chairman Sir David Walker. The bank said that it had reduced the number of million-plus earners since 2011, and had adjusted its bonus pool to account for the £290 million fine it received for its role in the Libor scandal.

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Chancellor Fails to Prevent EU Cap on Bonuses

(And finally. Picture the scene.) The UK was defeated by all 26 EU member states this week when chancellor George Osborne failed to prevent the EU imposing a cap on bankers’ bonuses. The new rules will limit bonuses to the equivalent of a banker’s annual salary, or up to double the salary if shareholders approve. Critics believe that the measure will dampen banks’ competitiveness and prevent banks from clawing back cash if employees are found guilty of misconduct in the future.

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Don’t miss our latest feature articles this week:

The Bank of England Needs to Stop its Crusade Against Savers

Yep. Normally, we get everything we deserve in Europe. Any Eurovision fans appreciating the audio in-jokes? 😉

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