Bank of England: a steady hand at the helm

The UK Monetary Policy Committee has voted to leave interest rates on hold at 4.75%, sparking rumors of cuts before the end of the year. The decision was prompted by weak manufacturing and retail performance. The Bank of England has been sensible in adopting a 'wait and see' policy, but with levels of UK personal unsecured debt at an all time high, it may be forced to act further down the line.

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Barclays: bad debt no cause for panic - yet

Thanks in recent years to a conducive environment of low interest rates, low unemployment and growing acceptance of personal debt, UK citizens now have the highest level of personal debt in Europe. A booming consumer credit market has supported this, however as we head into 2006, lenders such as Barclays are struggling to prevent boom turning to bust.

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Consumer credit: government revisits lending practices, but potential changes remain uncertain

The UK coalition government recently announced the launch of an inquiry by the Department of Business, Innovation and Skills to decide whether interest rate limits on loans and cards should be capped. There is little to suggest that this will yield a different result to the previous investigation, aside from the strong and vocal support of various prominent Liberal Democrats.

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Consumer debt: dramatic rise in bankruptcies signals trouble ahead

Figures published by the DTI on Friday show a dramatic increase in personal bankruptcies in 2003. Consumers are more in debt than ever before and with changes to the insolvency regulation due to be implemented in April, this worrying rise may be the first of many more. The knock on effect for the lending industry could be immense.

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Egg: cutting its losses in France

Egg's [EGG.L] Q1 results reflect contrasting fortunes in the UK and France. Egg has been exceptionally successful in the UK market since its launch five years ago, but its recent foray into the French card market has been nothing short of disastrous. Although loses in its French business have declined as the bank reins in its spending, Egg's fate will be in the hands of its eventual new owner.

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Extra regulation should not ignore the fact that payday lenders meet a consumer need

There have been calls for limits to be imposed on the amount that payday lenders can charge their customers. However, with an increasing number of people needing short-term loans, these companies do have a role to play in the market. Authorities must avoid imposing excessive controls in this area so as not to create a situation where consumers instead borrow from unregulated, illegal loan sharks.

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Finance for the elderly: empty nesters on the increase

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Home credit: more low-income credit choices needed

The National Consumer Council has filed a super-complaint to the Office of Fair Trading against the UK home credit market. It argues that a lack of adequate competition is harming high-risk consumers. With the government already concerned about overindebtedness, Datamonitor's Edward Ripley explains that this complaint could signal trouble ahead for one of the UK's oldest lending industries...

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Investigation into home credit suggests tougher action around the corner

The UK's Competition Commission's initial findings from its investigation into the home credit market acknowledge the benefits doorstep lending can bring to some consumers. However, the commission also highlights several issues that suggest a lack of competition in the sector, meaning that the leading home credit players should expect remedial action ahead.

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LG Card: Shinhan confirms its place in new order

On August 16, 2006, Shinhan Financial Group became the controlling owner in LG Card Co at a suspected cost of around US$7.5 billion. While foreign players balked at the potential price required to win the race for LG, Sinhan clearly feels it is a price worth paying to clinch a deal that will see it emerge as a major rival to Kookmin Bank in the South Korean lending market.

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