Caxton FX, a firm that specializes in foreign exchange and international markets, has released some concerning information for UK businesses. According to their recent study, charges from banks conducting overseas transactions are costing businesses in the UK £356 million a year. Once again, Santender, Barclays and the other big banks are some of the big offenders.

Some transactions are costing banks upwards of £40 each. Even the average fee of £21.40 is more than most local businesses can handle.

Once again, Barclays is charging its customers the highest fees. Barclays customers are forced to pay £25 for a single transaction, but may be required to pay up to £40 if they want to expedite it. The other banks that charge significant fees are requiring a little less than £30 for an express transfer.

These fees are putting significant pressure onto the banks. However, they are not the end of the story. Businesses are also required to pay the exchanges fees of the host country they are working with, which can be significant for many countries.

According to Caxton, the average business makes nearly 40 transactions each year. These transactions cost the banks nearly £800 annually. According to a spokesperson for Caxton, these fees are an extreme burden for UK businesses, but they feel powerless against changing them.

One of the concerns is the oligopoly stronghold the big banks have over their customers. Some critics would almost describe their unity as a form of price fixing, but they feel powerless in their ability to change the banks fee structure.

Since it is not a member of the Eurozone, Britain is excluded from the Single Euro Payment’s Area (SEPA). Essentially, this means that Europe doesn’t have to worry about being charged for a number of the fees that are traditionally charged to account holders, even though the transactions are conducted as if Britain was a member of the Eurozone.

Although many businesses feel that the fees they are being charged are inevitable, they need to be reminded that there are other options, says James Hickman of Caxton. Businesses can reduce the impact these fees have on their bottom line by looking towards other banks instead.

There are more options available to large multi-national companies than to small businesses. However, small businesses can also join providers that take a more liberal approach to banking and do not charge the same fees as the major UK institutions such as Barclays.

Over the past year, many people have been increasingly upset over large bonuses paid to the executives at large banks. As the banks decline in profitability, they have continued to pay large bonuses to the executives leading the company. However, those banks appear to have finally started cutting back on the bonuses they’ve been paying out.

Last week, Fred Goodwin was stripped of his knighthood over bonuses were offered to executives after his company posted a significant loss. Ultimately, the Royal Bank of Scotland needed the largest bailout in the history of the United Kingdom.

The Network Rail was another major institution that intended to offer large bonuses to their executives, but has since retracted them. Earlier this week, the Network Rail announced they would be retracting £20 million in executive bonuses. According to the terms of the executive compensation package, the executives are eligible to receive up to 60 percent of their annual salaries each year in bonuses.

However, although the executives were eligible for these bonuses, no bonus is guaranteed or was agreed upon. The Network Rail has found more useful means of using the funds available. The company said that it intends to spend more money on safety programs.

The executives will not receive any bonuses this year. In subsequent years, they will be forced to negotiate a new package.

As political pressure increases, the executives are likely to receive a significantly lower compensation in the coming years. Justine Greening, transport secretary, said that she will be attending Network Rail’s meeting this coming Friday. Greening hopes she will be able to influence the bonus package they will be offering in the future and hopes to discourage them from issuing any bonuses anytime in the near future.

The government said that the company is facing additional regulatory issues. Two months ago, they were also sent a notice from the Department of Rail and Transit, which reprimanded them for failing to arrive at their scheduled locations in a timely manner.

As the government, shareholders and general public become more irate over the future of executive bonuses in the country, stricter policies over executive bonuses are becoming increasingly likely. These bonuses will likely become far less generous in the coming months and executives will likely be forced to work harder to earn them.

You know the saying, put your money into bricks and mortar and you’ll see a long term return, but it seems one Irish artist has taken that advice literally. As an artistic statement about the bankrupt Irish economy, Artist Frank Buckley has built a house made from over 1 billion euros of shredded decommissioned notes.

Frank Buckley's Billion euro house is made entirely from €50,000 bricks of shredded decommissioned notes

The billion Euro house sits in the lobby of the Glass House in Dublin, an empty office building in the city centre. The money, which comes in pulped bricks of shredded decommissioned notes, was loaned to the artist by the Mint.

The idea came to Mr Buckley while he was waiting for a friend outside the building and the owners of the Office block were immediately keen on the idea. He had been given a block of the shredded notes to use as confetti at his wedding, which acted as inspiration. The unemployed artist simply asked the Mint for a lorry load more and while there was almost as much paperwork involved; the Mint were more than happy to assist.

Citizens throughout the UK are having one of the most difficult times buying new homes than any other point in the past century. Stagnant wages, increasing unemployment and raising home prices are making the prospect of buying a house nearly impossible for many people, especially citizens under the age of 35.

The fact that banks are unwilling to lend much money is even more concerning. Now the banks have added another complication that makes the situation even worse: they are still increasing mortgage fees. According to recent research, mortgage fees have increased by 70% in the past 12 months. The average fee for committing to a mortgage has increased to almost £1,500. This is the highest in the history of the country. The average worker makes that amount of money or less in an entire month.

Meanwhile, tens of thousands of home-buyers are looking for a new abode every month. They shop around for the best possible rates and these kinds of fees just add more grief to their lives. Mortgage rates are increasing for many existing homeowners as well. Many homeowners have no choice but to use their credit card or payday loan to pay their mortgage each month. Meanwhile, credit card fees are increasing as well and payday loans charge about 4,000% interest.

According to one research organization, mortgage fees were less than £900 a year ago. They are skyrocketing as struggling banks look to pass more of their financial burdens onto their customers. The highest fees are now over four times that amount.

Increasing mortgage fees have dampened the hopes any hopes England’s central bank had for the country when it pledged to keep interest rates low. The Bank of England hoped that it would be able to encourage banks to lend more and at more affordable rates for consumers.

Nevertheless, some experts contend that the increased mortgage fees are not necessarily a bad thing. As long as the larger fees are associated with lower interest rates, customers can still come out ahead, especially if they are looking to take out a large loan.

The problem with this position is that mortgage rates have been consistently low for quite some time. Even though mortgage rates have been declining consistently, they are no longer doing enough to offset the rising fees. This is likely to make the financial burden even worse for customers for a long time to come.

According to Paul Smee, Director of the Council for Mortgage Lenders, many people may now be unable to achieve their dream of ever owning a home. Smee even went so far as to say that the concept of home ownership is an “unrealistic assumption” for many people.

While fears of a renewed banking crisis haven’t caused as many concerns as originally predicted, they have undoubtedly caused some frustrations for a number of customers. Although the bank rates have remained constant over the past three years, banking concerns have caused mortgage rates to increase over time.

According to Kara Gammell of The Telegraph, the Eurozone crisis has caused a loss of faith in the European banking system. As the perceived risk of the EU banking system becomes a greater concern, they are likely to have a number of additional worries. One of the biggest problems is the raising interest rates and exchanges rates.

According to technical manager of Charcol, Ray Boulger, the banking crisis in the EU is increasing the marginal costs for lenders. In turn, those fees must be passed on to mortgage customers.

As a result, customers who are looking for a mortgage without being willing to put down at least a 10% deposit are likely to pay much larger mortgage rates. Although there are signs that the market for first-time buyers is improving, the increasing bank fees are a major concern for home buyers. Boulger encourages families to seriously consider increasing their deposit in order to be eligible for lower rates.

Customers may also have to take advantage of other new deals. For example, they may want to consider looking at fixed rate, five-year deals. These deals may help insure them against threats from rising rates as the Eurozone crisis becomes a greater concern.

Consumers should be concerned over the recent debt downgrades in the Eurozone. The S&P downgrades have raised worries that the Eurozone crisis continues to escalate and exchange rates are likely to increase. In turn, this is likely to increase the mortgage rates of banks throughout the UK as well. UK banks are already facing a number of challenges as they struggle to maintain their profits.

Concerned banks have decided to increase the banking fees issued to many of their customers. It is also conceivable that other rates may need to increase in future months as well.

Although new home buyers aren’t likely to be overly optimistic by this news, they are going to find they can still reduce their mortgage rates by taking some of the steps Boulger has proposed.

Billionaire Richard Branson took over Northern Rock plc earlier this month. Following the takeover, Branson’s holding company Virgin Money will be responsible for the 75 branches and 21,000 staff that currently work for Northern Rock.

Many investors have praised the takeover, arguing that it was the only hope that the bank had to avoid a complete banking collapse. However, customers of Northern Rock were not as optimistic about the deal.

Branson announced that he intended to impose an annual £60 fee on all existing bank accounts. This approach is likely to create a lot of controversy and be met with hostility by existing bank customers.

Therefore, Branson has decided that it would be unwise to proceed with only offering fee charging accounts and decided to take a different approach. Instead of charging fees on all accounts, Branson intends to offer customers the choice between opting for free accounts or accounts that charge fees in exchange for incentives. Incentives include opportunities to earn discounts gym membership or trips through Virgin Flights.

Although the new proposal is being met with less criticism, many consumer groups are still skeptical of Branson’s new solution. These groups argue that these deals tend to be of low value and are likely not worth as much as the customers would be paying each month. Nonetheless, it is encouraging for many people to see that Branson is at least working on a new system that would help eliminate mandatory fees for Northern Rock customers.

Eddy Weatherill, of the Independent Banking Advisory Service states that customers are becoming increasingly concerned over the fees being implemented by banks throughout the UK. Weatherill even went so far as to say that no one trusts banks anymore and that bankers are going to need to implement much more equitable programs if they intend to regain that trust.

Many consumer advocacy groups praised reporters who brought the situation to their attention and put pressure on Virgin Money to withdraw the fees. They were afraid that if they failed to get Branson to back off of the fees, other bankers would revoke free accounts as well.

The new announcement directly contrasted statements made by Virgin Money at the beginning of the year. Branson’s employees argued that the fees were fairer and more transparent than those issued by a number of other banks, which were often issued with more secrecy.
Read more: http://www.dailymail.co.uk/news/article-2084996/Richard-Branson-backtracks-60-bank-fees-Northern-Rock-takeover.html#ixzz1jf2O9dn2

The latest UK figures for unemployment show the highest number of people without a job since 1994, with 2.68 million out of work. The figures, released by the Office for National Statistics (ONS) revealed some discouraging statistics including:

- 29.7% of youths aged 16 – 24 unemployed

- 8.4% of the economically active population unemployed

- 0.3% rise in umemployment on the previous quarter, a rise of 118,000.

- There were 2.68 million unemployed people

- Highest number of unemployed people since 1994

If you’re employed in the private sector you may be surprised to read that both regular pay and bonuses rose by 1.9% on the same period last year. Of course this is cold comfort for many who face the threat of redundancy and not much good to public sector workers but it does show some positive movement.

Any early signs of a smile emerging may be wiped off your boat race by the predictions of leading analysts, declaring that the UK has already slipped back into recession. On the plus side, it’s the Olympics this year and what better than a national showcase to bind the multi-cultural societies of our great nation (if you’re not proud about your country, it couldn’t help).

Banks throughout the UK and other regions in Europe continue to face substantial losses. As they attempt to get their finances back under control, many people believe that they are going to be charging higher fees. They will likely face added pressure as new regulatory pressures.

Consultants from Pricewaterhousecooopers said that there is almost no way that banks would not begin creating new fees. However, they also said that the practice may not have to continue indefinitely. Another trend may counteract the increase in bank charges. As competition increases in the banking industry, banks are probably going to have to limit the fees they charge.

Pricewaterhousecooopers is not the only analyst to suggest such a trend. Another report was issued by the Confederation of British Industry. That report suggested that there was a significant fallout from the banking crisis in the Eurozone. As the debt crisis continues to infect the UK banking system, the local banks will need to find new ways to address it. The CBI report corroborates the findings of Pricewaterhousecoopers, further arguing that the banking crisis is going to get significantly worse. The only way they believe the banks can shelter themselves from the fallout in the Eurozone is to charge higher fees to their customers.

Over the most recent quarter, the banks posted much higher earnings. Nonetheless, austerity measures and the EU debt crisis are going to have a significant effect on the future of the banking system. Analysts have no way of predicting when there will be another major fallout and whether or not the banks will need to take more drastic action.

Regardless of how they intend on handling the crisis in the Eurozone, the banks are probably going to feel the need to charge more money as they try to increase their financial position. A number of different banks are still implementing a number of bank fees and even some of the newer banks are getting ready to start setting up programs that are going to charge their customers.

While Barclays and Santander continue to charge a number of fees to their customers, newer companies such as Virgin Money are also charging their customers for a number of the privileges they have instituted.

UK customers are still looking for alternative solutions. Many may consider transferring their accounts to credit unions the same way American customers did when they got frustrated with the fees they were being charged by Bank of America. However, these transitions are unlikely to happen overnight and they will probably be forced to contend with a number of high fees for the time being.

If we reported on every discrepancy that was made by an insurer, bank or lender then it would be all we ever wrote about, but a recent fine imposed by the FSA is definitely worth mentioning. The Combined Insurance Company of America (CICA) has been hit with a fine of £2.8m for employing a ‘high-risk’ pay scheme that governed the wages of their sales agents.

The City watchdog slapped CICA with a £2.8m fine

The Financial Services Authority (FSA) said that the way sales staff earned their money led to customers being at risk of being treated unfairly when buying accident and sickness insurance. As a result of the findings, CICA has agreed to look into the way customers are treated and pay compensation to where appropriate.

Most of CICA’s policyholders were self-employed or small business owners with the FSA citing the following business failures that led to the fine:

- Sales staff with less-than-adequate qualifications and missing references

- Failure to ensure that sales staff had the knowledge to provide appropriate advice

- Paying sales agents on a commission-only basis was deemed ‘risky’

- Customer complaints and rule-breaking sales staff where not dealt with adequately

The above issues combined with the £2.8m fine (reduced from £4m after an early settlement) and FSA ruling has resulted in CICA not taking on any new business since October last year.