A round-up of the main news stories from this week.
Bank of Ireland Mortgage Hike Faces Probe
Regulators have been asked to review a shock decision by the Bank of Ireland to hike its tracker mortgage rates to well over double their current levels. Over 13,000 customers with the bank are expecting to see their mortgage rates rise from the current level of 1.75% to 2.5% in May and 4% in October. Treasury Committee chairman Andrew Tyrie has asked the Financial Services Authority whether it plans to investigate the bank on suspicion of mis-selling practices.
Building Societies Call For Improvement to ISAs
The Building Societies Association has joined calls for the Government to improve conditions for savers. The BSA believes that savers should be paying less tax on returns from savings accounts while rates are so low. It also wants rules regarding cash ISAs to be simplified so that savers can invest their entire annual tax-free allowance in cash, rather than just half as it is currently.
Osborne Accused of Contempt Over Bank Reforms
Chancellor George Osborne has been accused of showing contempt for Parliament after he failed to attend a debate on key reforms for the safety of the banking sector. The cross-party Banking Standards Committee, which has been gathering data over recent months, has accused the chancellor to trying to force through a watered down version of his banking reform bill without waiting for its detailed recommendations. The most significant change it has proposed is the option to break up big banks if they attempt to get around the ring-fence between retail and investment banks.
Channel Islands Targeted for Tax Clampdown
The Channel Islands have become the latest target for the UK tax authorities as the clampdown on tax dodging extends to nearby off-shore havens. A deal has been reached to unseat Guernsey and the Isle of Man as the prime destinations for lower taxes. Guernsey is thought to hold £4 billion across thousands of bank accounts. The deal follows an arrangement with Swiss authorities to reclaim £5 billion in tax from secret bank accounts held by UK nationals.
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