[KevO]

if it does then TSHTHTF

$this->bbcode_second_pass_quote('', 'B')arclays has denied rumours it is about to reveal a $10bn (£4.8bn) exposure to US mortgage bad debt.

The speculation saw shares in the banking giant plunge 9% during Friday trading, and they were at one point even temporarily suspended.

Barclays denied the rumours, saying they were "unsubstantiated", and its shares recovered some ground to end the day down 2.4% to 474.50p.

Other UK financial stocks closed lower, following the rumours about Barclays.

Shares in Royal Bank of Scotland ended down 3%, while HBOS, HSBC and Alliance & Leicester all lost more than 2%.

Industry wobble

While Barclays' comments helped ease some concerns, worries continue over which UK bank may be next to follow Northern Rock and suffer from the ongoing global credit crisis.

[sjn]

I have a couple of thousand £ in a Barclays Internet savings account! Is this covered by the FSCS? Should I pull it out...??? Shit. Only £4.4m left to protect UK's bank deposits
This could be a problem.

[sjn]

$this->bbcode_second_pass_quote('HydroLuver', 'B')arclays is a HUGE bank with a market value of $65 billion. It has assets (deposits) of several hundred billion dollars/euros.

Even if they have a writedown of 10 billion Euro, it would be about 15% of the value of the company. It hurts, but it is not the same situation as Northern Rock.

Northern Rock got nailed because they didn't have a deposit base to continue their business model. Their funding was through the capital markets selling commercial paper. They got frozen because that source of capital dried up. The same thing happened to CountryWide in the USA. Too reliant on commercial paper that has dried up.

[RdSnt]

But what are those assets? And how much are they really worth? If they are sub-prime mortgages or CDO's then they could be worthless.


$this->bbcode_second_pass_quote('HydroLuver', 'B')arclays is a HUGE bank with a market value of $65 billion. It has assets (deposits) of several hundred billion dollars/euros.

Even if they have a writedown of 10 billion Euro, it would be about 15% of the value of the company. It hurts, but it is not the same situation as Northern Rock.

Northern Rock got nailed because they didn't have a deposit base to continue their business model. Their funding was through the capital markets selling commercial paper. They got frozen because that source of capital dried up. The same thing happened to CountryWide in the USA. Too reliant on commercial paper that has dried up.

Banks with large sources of retail banking customers are in a completely different situation. Barclarys is that type of bank.

[KevO]

Nevertheless, only a fool would trust the bank to be OK. Ignore the 'experts' advice and go queue first thing tomorrow, or transfer the lot to another bank via BACS immediately, though how safe any bank is now is a lotto!

[Grifter]

Just for the record, I forcast Barclays going the way of Northern Rock before the Northern Rock fiasco happened.

Reason being, I work in an industry that pays the wages for a lot of people. For the last 3 months a number of people that bank with barclays have had letters, everytime we pay them, to say we have paid them in Euro's.

We don't pay anyone in Euro's

This started happening WELL BEFORE much about sub prime mortgages was in the mainstream. It was however being talked about on PO.com, which is why I predicted Barclays (only in the real world btw) to be in trouble.

This story is a biggy.

[Grifter]

$this->bbcode_second_pass_quote('KevO', 'N')evertheless, only a fool would trust the bank to be OK. Ignore the 'experts' advice and go queue first thing tomorrow, or transfer the lot to another bank via BACS immediately, though how safe any bank is now is a lotto!

[sjn]

From this month Barclays are making it harder transfer money to other banks through BACS. They now require the use of an electronic key generator which they will supply to custommers on request. Interesting eh?

[shortonoil]

The danger with any bank is how much they have hedged those deposits. If the leverage is 20:1, it won’t take much of a loss to wipe them out. Look what happened to B.S. and most of that was at 6:1.

Of course if you ask them, they won’t tell you much about the real situation, and that might be because they don't really know. Mark to Hopes & Wishes is dangerous to everyone.

[Andrew_S]

$this->bbcode_second_pass_quote('Grifter', '
')Reason being, I work in an industry that pays the wages for a lot of people. For the last 3 months a number of people that bank with barclays have had letters, everytime we pay them, to say we have paid them in Euro's.

We don't pay anyone in Euro's

[Andrew_S]

I suppose my choice of internet forums is not typical. But if you guys and those at housepricecrash.co.uk half reflect the British public, it looks like there's gonna be a run on Barclays next week.

Play safe.

[Chesire]

$this->bbcode_second_pass_quote('Andrew_S', 'I') suppose my choice of internet forums is not typical. But if you guys and those at housepricecrash.co.uk half reflect the British public, it looks like there's gonna be a run on Barclays next week.

Play safe.

[thor]

$this->bbcode_second_pass_quote('sjn', 'F')rom this month Barclays are making it harder transfer money to other banks through BACS. They now require the use of an electronic key generator which they will supply to custommers on request. Interesting eh?

[Grifter]

$this->bbcode_second_pass_quote('Andrew_S', '')$this->bbcode_second_pass_quote('Grifter', '
')Reason being, I work in an industry that pays the wages for a lot of people. For the last 3 months a number of people that bank with barclays have had letters, everytime we pay them, to say we have paid them in Euro's.

We don't pay anyone in Euro's

[sjn]

Seems they've now also set a maximum transfer limit of £1000/day from their current accounts. Sneaky!

[virgincrude]

thor: I'm starting to believe that all of our savings aren't really ours and banks can do whatever they please.

How could you ever have thought otherwise? Banks DO whatever they please and so long as they don't get caught, everything works just fine. Banks are the biggest scam on earth, they play with your money all the time, all over the place. Did you think there was some little box down at your local branch in which was stowed YOUR hard earned dosh?

A recent scam has been 'offering' you the option of placing a large portion of your savings in a stock market index-linked basket over a minimum one year period, at the end of which they GUARRANTEE you get back what you put in, but they assure you that you will also increase your savings by whatever gains they make on the stock exchange for you. Neat, eh? Seeing how everybody's always making huge gains on the stock exchange, it looks like a quick way to make your lump sum grow. However, there are no guarrantees you will actually gain anything, no matter what happens on the stock exchange during the time you have allowed the bank to sequester your money. Just the guarrantee that you get back the same amount you started with after the whole game is done.

In effect, all that happens, is that the bank gives your money over to the boys on the game who may make huge killings and go home happy while at the end of it all you've done is see your money kidnappedand returned at the end, unscathed. Somebody makes a profit, but it's not you.

Other similar scams are where you have an interest earning savings account, which is subject to regulation taxes, and then the bank charges you what ever fee they fancy, for the pleasure. Your money earns a fraction of the percentage they sold you the idea with in the first place and you end up paying the bank for the privilege. Bank charges are the next-best invention to interest: they conjure money from nowhere and guarrantee the banks don't lose, but the customer always does.

[dorlomin]

$this->bbcode_second_pass_quote('sjn', 'S')eems they've now also set a maximum transfer limit of £1000/day from their current accounts. Sneaky!

[sjn]

$this->bbcode_second_pass_quote('dorlomin', '')$this->bbcode_second_pass_quote('sjn', 'S')eems they've now also set a maximum transfer limit of £1000/day from their current accounts. Sneaky!

[Twilight]

A limit like that does make good sense from a security perspective; unusual transactions still get flagged but the daily transfer cap gives the fraudster less money to play with. There won't be a cap if you show up at a branch in person.

But this does have the handy bonus effect of limiting the speed which which depositors can drain their accounts electronically. With a virtual run, the only other bottleneck is the resilience of the IT system itself. I do think this is just coincidence though. The move makes perfect sense on its own.

About Barclays, I don't know. The thing about the current crisis is you just can't tell who is affected. That's why I'm in cash in several institutions. I can accept being wiped out in a systemic meltdown, but not having everything in one place, no way.

I doubt we will see a run on Barclays over the recent rumours. The media speculation has been too vague. Northern Rock was a real story. This is a case of wait-and-see, there will be many more like it. If a real story gets going, watch out. And remember that once a run starts, the bank is already dead. There is no regret to be had in joining in.