It’s now 1 year since the term “the credit crunch” entered public circulation. The first signs can be dated back to February 2007 when HSBC issued a profits warning.
UK Banks made some pretty horrendous decisions taking on bad debt from the US. Unfortunately these mistakes have been passed onto customers higher mortgage & loan interest rates.
This week banking heavy weights HSBC, the Royal Bank of Scotland & Barclays issue trading updates this week. The results will be interesting. As mentioned last week the only people to lose their jobs are some Directors at Northern Rock.
What will happen next?
The Mortgage market will continue to be complicated, so it is worth getting proper independent advice before making a decision.
Banks will probably merge, we have already seen Santander (Abbey) swallow up Alliance & Leicester. Some smaller banks such as Bradford & Bingley and even some building societies could follow suite.