Spanish practices and the Abbey habit

Thought Woolworths was the last big name to go? Wrong! The Spanish banking giant Santander is taking a bag of castanets to the High Street names of Abbey, Alliance & Leicester and Bradford & Bingley. In a flourish of flamenco style dancing, the banking names will be attending the last dance for British brands. From now on it will be Sun-Tun-Dare!

Am I upset? Not really. It's just the way things are. I doubt very much that customers will see much change other than bright red logos. Banking is now a global phenomenon. It doesn't matter if it is Spanish or British or whatever. We are told we need banks of this size in order that we can get the service we require. So I am resigned to it all. That is, at the moment.

However, I may wake up tomorrow morning thinking, "Hey wait a minute, do I want this?" and the answer may well be NO! The only way we are going to get back to any semblance of local banking, with local people knowing about local needs is if we demand it. Maybe Mr.Bradford and Mr.Bingley may not take it on the chin. There is talk of splitting the business interests of retail banking and investment banking, which is still no more than vague discussion.

Ordinary customers of banks should speak up. We need a voice that is demonstrably more assertive than the present set-up of FSA lackies and the badger look-a-like in No 11. If this credit crisis and political fall-out lead to anything, surely consumer power is to be part of it.

Spanish practices?

The credit crunch is crunching quite well for some people! By that I mean they are getting the frights from frightful bankers. You'd think some coroporate types would engage their brains before pushing the button on the computer so that the machine could spew out another unread missive?

Abbey National is not what it seems to most. It is now a Spanish owned bank. By Santander to be precise. They want to keep their coffers sound in 2009. Now I don't blame them for that. What I do say is that it is underhand to be sending out letters warning customers of the impact of lower house prices on their mortgage contracts, by alluding to a clause in the contract. A clause that was so far down the small print that nobody thought fit to mention it in the first place!!

A spokeswoman for Abbey has reassured customers the bank had "not invoked this particular clause" and had "no current intention to". "What we would say though, is that in a falling house price environment, it is prudent for people on flexible deals who find themselves at over 90% LTV [loan-to-value ratio] to look at whether they can afford to make any overpayments," she said. "If they can pay off some capital to bring their LTV down, we would encourage them to do so."

So this is a way of getting hard-pressed people to cough up extra cash at a very hard time. Here's how one couple felt about the shocking news!