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07/10/2008
Further Suffering In The City
There appears to be widespread financial chaos, following another disastrous day on the London Stock Market.
Shares in one of the UK’s biggest banks plummeted by 40% and European officials failed to agree away forward on the global lending crisis.
The situation has been made worse by the revelation City bosses approached the Chancellor, last night, for a £50b cash injection, to help prop-up domestic banking institutions.
Senior City bosses are said to be furious news of the secret meeting broke – further undermining confidence in the economy.
During early trading the Royal Bank of Scotland saw share prices tumble by 40%.
The £10b fall followed on from yesterday’s 20% drop in stock market value.
The bank, however, denied any ‘cap-in-hand’ meetings with the government.
Yet RBS sustained a further blow, with Standard and Poor downgrading the bank, making them a less secure institution to lend to.
The bank blamed today's share price fall on two very large share trades taking place, which under stock market rules meant that the shares were temporarily suspended.
But RBS was not the only bank to suffer in the city.
UK consumers seemed to react rapidly to the prospect of high street banks facing possible partial-nationalisation.
A fear that caused a 26% plunged in Lloyds TSB share values, a 17% fall in Barclays and a 23% dip HBOS stocks.
Barclays strongly denied it had taken part in any meeting with the government yesterday.
Despite the values recovering, somewhat, later in the day, it is highly anticipated Chancellor Alastair Darling will approve a ‘bail-out’ for the banks, but has faced criticism for ‘dithering’ on the issue.
Vince Cable, the Liberal Democrat treasury spokesman, said: "The Government must come clean on its plans very quickly, otherwise continued uncertainty will force more banks to the wall.
"We're effectively talking about part-nationalisation, and there is no point in trying to conceal that.
"It is much more sensible to deal with this proactively, rather than through a succession of collapses like those of Bradford & Bingley or Northern Rock."
(PR)
Shares in one of the UK’s biggest banks plummeted by 40% and European officials failed to agree away forward on the global lending crisis.
The situation has been made worse by the revelation City bosses approached the Chancellor, last night, for a £50b cash injection, to help prop-up domestic banking institutions.
Senior City bosses are said to be furious news of the secret meeting broke – further undermining confidence in the economy.
During early trading the Royal Bank of Scotland saw share prices tumble by 40%.
The £10b fall followed on from yesterday’s 20% drop in stock market value.
The bank, however, denied any ‘cap-in-hand’ meetings with the government.
Yet RBS sustained a further blow, with Standard and Poor downgrading the bank, making them a less secure institution to lend to.
The bank blamed today's share price fall on two very large share trades taking place, which under stock market rules meant that the shares were temporarily suspended.
But RBS was not the only bank to suffer in the city.
UK consumers seemed to react rapidly to the prospect of high street banks facing possible partial-nationalisation.
A fear that caused a 26% plunged in Lloyds TSB share values, a 17% fall in Barclays and a 23% dip HBOS stocks.
Barclays strongly denied it had taken part in any meeting with the government yesterday.
Despite the values recovering, somewhat, later in the day, it is highly anticipated Chancellor Alastair Darling will approve a ‘bail-out’ for the banks, but has faced criticism for ‘dithering’ on the issue.
Vince Cable, the Liberal Democrat treasury spokesman, said: "The Government must come clean on its plans very quickly, otherwise continued uncertainty will force more banks to the wall.
"We're effectively talking about part-nationalisation, and there is no point in trying to conceal that.
"It is much more sensible to deal with this proactively, rather than through a succession of collapses like those of Bradford & Bingley or Northern Rock."
(PR)
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Northern Ireland WeatherToday:It will be cloudy again throughout the day. Mainly dry in the morning, but patchy drizzle in places, becoming more widespread and persistent in the afternoon. Freshening southwesterly winds. Maximum temperature 12 °C.Tonight:Cloudy with a spell of heavy rain pushing south through late evening and the early hours, followed by some clear spells. Minimum temperature 6 °C.
