Sunday, 29 March 2009

Broon's Dunfermline Sacrifice

Just been watch Jim Faulds currently still the Chairman of the Dunfermline Building Society at least for today quite rightly getting angry at the way the Government has dealt with this scenario.

He has accused the Treasury of being economic with the actualité. He said that unlike Northern Rock they did not have a Sub Prime Mortgage issue. That the losses that Dunfermline were going to announce of £26 million were less than the £36 million that the Chelsea Building Society lost in Icelandic institutions alone.

He also said that there was no exposure to the US toxic debt. Stating that KPMG has said they could be supported and sustained as an independent ongoing interest. Something that Jim Murphy then seemed to be very unsure about when challenged that they were.

He also protested at the lack of proportionality, the risk that has been being covered by the government in the banks as opposed to the lack that they have given the the Building Societies such as Brandford and Bingley and now Dunfermline. The mortgage book of Building Societies is back by bricks and mortar, at the end of this recession those assets will still exist and start to recover, unlike many of the risky investments that the Government has been bailing out for over £1 trillion of protection. When challenged on those with a worst situation Murphy only said that each situation was different (possible some of the others exist in Labour held seats).

Faulds also complained that he and the rest of the board were getting their news from the press before the FSA, the Treasury and the Scottish Office.

It appears that the Government is not prepared to stand by the Building Societies. I've even heard Jim Murphy just say that this is a short term problem. Again blaming it on the international situation, taking no blame for 12 years of UK Government mismanagement that has ended up seeing the country so heavily in debt that the worse offenders ended up at the front of the queue and were helped no questions asked in full and now those that managed to survive that bit longer are being left out to dry or being sold off. Like Mr Faulds said in answer to the first question Dunfermline is a sacrifice not a solution.

Willie Rennie MP for Dunfermline and West Fife then came on later to say it was a disgrace what Jim Murphy was saying. There has been a deal on the table from the UK Building Societies for six months and that the Government has been partially responsible and the FSA's levies are exacerbating it.

Where will it all end? Who will be next to be left out to dry?

Update: Moving unto the Euro debate on Scottish Politics and Labour's David Murray again trying to sidle away from the fact, for fact it is, that while there may have been a US element to our recession we are worse off than the rest of equivalent sized Western Europe countries. Struan Stevenson correctly brought him to task in trying to

1 comment:

  1. Well, well, well, who would have thought it - the Dunfermline management blames the politicians and the politicians blame each other.

    Who to believe?

    To objectively assess the situation you really have to be a financial expert who knows the Dunfermline's balance sheet intimately.

    I'm neither, so I don't believe any of them!!