Abbey National: the mixed blessings of market regulation

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Abbey/Banco Santander: restructuring program is still the key

Mixed reactions to Banco Santander's [SAN.MC] bid to acquire Abbey [ABBE.L] are perhaps unsurprising given the UK bank's recent woes. However, the Spanish group stands to gain a major presence in UK retail banking. Additionally, Banco Santander could transfer some of Abbey's recently developed competences in wealth management to neighboring European markets.

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Abbey: back to black

Abbey [ABBE.L] has returned to profit in the first quarter of 2004. However, when compared to the recent record profits of many of the UK's high street banks, parts of the results are still disappointing. Investment sales in particular have fallen dramatically, however its future plans to offer 'wrap' platforms should see it bounce back.

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Abbey: fine time

Banco Santander-owned Abbey [ANL.L], the UK's second largest mortgage lender, is bracing itself for an expected FSA fine over its endowment mortgage complaint procedures. Although such a fine would bring the lender community more bad press, it at least embodies the welcome regulatory pressure on providers that persistently ignore mortgage endowment complaints.

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Abbey: FSA condemnation

The Financial Services Authority has fined Abbey [ANL.L] a record GBP2 million for "serious compliance failings" relating to its money laundering monitoring between December 2001 and April 2003. The fine will hurt Abbey as it has invested large amounts in growing its wrap platform and the success of this proposition will depend on the company's ability to gain trust from IFAs.

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Abbey: pay as you go

Abbey [ABBE.L], the UK's third largest mortgage lender, has raised the fee it charges on early redemption by 25%, to GBP225, and evidence suggests it is not alone among lenders in so doing. While these rate hikes are in response to higher administration costs, some lenders may be using early redemption fees to bolster margins by the back door.

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Abbey: reopening old wounds

Reports suggest the FSA will rule that Abbey must review rejected complaints over endowment mis-selling. Such a move by the UK banking watchdog would come at the worst possible time for Abbey. Abbey's new owners Banco Santander have already faced criticism over heavy job losses: the last thing the bank needs now is a public admonishment over its complaints procedures.

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Abbey: short-term solution

By cutting the payouts to its life insurance policyholders, Abbey [ABBE.L] has avoided the wrath of its investors. The move may have plugged the financial gap in the short-term but it has not solved the underlying cash flow problems faced by Abbey's life division.

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ABC Insurance: LV= expands general insurance business

LV= has announced that its new broker division, ABC Insurance, is scheduled to launch in June 2007. The launch will add a new brand, an additional distribution channel, and a strong management team to LV='s proposition; moving it one step closer to its ambitious aim of becoming a top five UK general insurer.

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Aberdeen Asset Management: bleak investment house

UK asset manager Aberdeen's stock keeps plummeting, and its future looks bleak. In the eyes of many investors, the company is reaping the rewards of its ill-gotten gains from the TMT bubble. Aberdeen may end up as the compensatory head that UK investors are served on a platter - and some might view this as just deserts.

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