News Archive

Finance company Aberdeen Asset Management is to take over £40bn of Credit Suisse's fund management business in a move worth £250m.

The deal will create the UK's largest listed fund management group and see investment banking giant Credit Suisse take a 25% stake in Aberdeen.

The takeover is expected to complete by June.

Hundreds of thousands of endowment policyholders could find themselves with greater than expected shortfalls as their policies set to mature.

After becoming notorious in the 90's, there is a sudden rise in the number of policies due to pay out. But these come just as insurance providers are marking down their values due to share price falls and bonuses are being slashed by up to 75%. 

Many policyholders will find the remaining mortgage payments will not be met by the endowments.

Lower energy costs have helped to push the Consumer Prices Index inflation rate down to 4.1% in November from 4.5% the previous month.

The headline rate of Retail Prices Index inflation also dropped sharply in November to 3% from 4.2% the month before.

The falls came after energy costs have decreased and the average price  of a litre of petrol fell by 9.3 pence in the last month.

Despite the continuing fall in inflation, it is expected that the Bank of England's Monetary Policy Committee are to cut interest rates further.

Skandia has removed all fund manager initial charges from its Selestia Investment Solutions Platform, claiming that other platforms such as FundsNetwork, Cofunds and Transact still apply initial charges on the majority of their funds.

Skandia claim the move comes from the economic climate and clients needing to reduce costs as much as possible in order to maximise their returns.

Royal Bank of Scotland has revealed it will now wait for six months before those with mortgage arrears are repossessed.

The pre-Budget report pledged that banks will allow three months before repossession proceedings take place but RBS has extended this following a government bailout of its rights issue.

The government is to own 57.9% of Royal Bank of Scotland after shareholders did not buy all of its rights issue, part of its plan to recapitalise the bank.

Existing shreholders agreed to buy almost 56 million shares, which represents just 0.24% of the shares on offer. As such, the government will pay about £15bn for the majority stake in the bank with a further £5bn of preference shares.

Financial markets in India have been closed after attacks in the financial capital, Mumbai.

India's central bank has pledged to continue to make cash avaialble on the interbank lending markets. The news comes after the main index has fallen 50% and $13.5bn pulled from India since the start of 2008 due to the uncertain financial climate.

Friends Provident International has added two new investment plans to its product range.

The global wealth builder is a regular premium investment linked plan, with a minimum term of 5 years and a maximum of 25, designed to target specific goals such as retirement, education fees and house purchasing. The global wealth manager is a single premium investment linked plan which, enables savers to access 90% of capital in the short term allowing regular withdrawals for income.

Chancellor, Alistair Darling, has revealed that the Pension Lifetime Allowance is to be frozen at £1.8m from 2010 to 2015/16.

The change means that potentially more people will exceed this allowance and face a tax charge of 55%.

Previously, the LTA has increased by about 4%, which was widely expected to continue. 

Oil priices have fallen below $50 a barrel for the first time since May 2005 amid expectations that demand will drop.

The price of oil is around two-thirds cheaper than in July, when it hit a record above $147 a barrel.

It is thought cash looks more attractive than commodities in the current economic climate.

Lloyds TSB shareholders have voted in favour of taking over HBOS as well as taking government bail-out money.

The shareholders voted 95.98% in favour of the takeover and also of raising £5.5bn by issuing new shares and special preference shares.

HBOS shareholders will vote whether to create a banking giant next month.

Northern Rock has a launched a 3.99% one-year flexible mortgage with a 65% loan to value.

The launch coincides with Abbey for Internediaries recent launch of exclusive mortgages, including a two-year fixed at 4.39% and a three-year fixed at 4.69%, both with 60% loan to value.

It is hoped that such launches will ignite some competition back into the market.

New Star is to embark on a business restructure after the firm revealed a 15% fall in assets under management in the third quarter.

Sales of premises and renegotiation of banking covenants are to help cut costs. Assets under management fell to £14.3bn after a drop in asset prices and increased redemptions.

Major UK mortgage lenders have reshuffled deals following the Bank of England's surprise rate cut to 3%.

Cheltenhan & Gloucester, Abbey and Alliance & Leicester have all started to relaunch tracker deals for new borrowers, but are widening the the margin between the rate they offer and the base rate. Buyers are therefore having to search for larger deposits to take advantage of these deals.

The Bank of England has cut interest rates in the UK by one-and-a-half percentage points to 3%, its lowest since 1955.

It is the first time the Bank has cut rates by more than half a percentage point since gaining its independence in 1997.

Following the announcement the FTSE stock market gained more than 100 points at 4444.67.

Standard Life has added an integrated automated trusts suite to its wrap platform.

The Loan Plan, the Discounted Gift Plan and the Gift Plan are launching on the wrap, available with absolute, flexible or discretionary trusts and can be used with the onshore investment or international portfolio bonds.

Legal & General has teamed up with Investec to launch a new fund that will offer investors a no loss optional guarantee on its fifth anniversary.

The Legal & General Money Builder (Investec) fund launches today, with a minimum investment set at £5,000 and a choice of the guaranteed version at 2.4% Annual Management Charge or 1.9% AMC for the standard option. It is designed to give investors a better level of returns than a traditional bank savings account.

The planned merger between Lloyds TSB and HBOS has been cleared by business secretary Lord Mandelson, ruling the deal was in the public interest.

It was thought that the case would be referred to the Competition Commission, but it was decided that HBOS wouldn't exist if it were not for the bail-out of the bank.

Standard Life is to cut final bonuses and increase and extend market value reductions on its with-profits plans, with most customers policies decreasing value.

Standard Life say the charges are to ensure that fairness is maintained between planholders who chose to leave with-profits and those who remain invested until their plan maturity or retirement date.

The change is effective as of today.

The Government is proposing an amendment to the Pensions Bill to allow people to buy an additional six years of voluntary National Insurance Contributions to help boost the state pension for women and carers.

The proposals should help thousands of women who traditionally have incomplete NI records and therefore often receive a low state pension. It will apply to those who reach State Pension age between 6 April 2008 and 5 April 2015 and who already have 20 qualifying years on their NI record.

Norwich Union has introduced market value reductions on unitised with profits policies due to investment market conditions over recent months and the continuing uncertainty.

The move, which comes into effect immediately, has been put in place to prevent policyholders leaving or withdrawing money from with profits funds taking for than their share of the fund at the expense of those who remain.

The Hartford has expanded its product range with the launch of The Hartford Diamond, an International Investment Bond.

It offers an annual income of four to six per cent with access to 113 funds, selected by Old Broad Street Research. It carries a minimum investment of £10,000 and the 'safety net' enables investors to guarantee income for up to 20 years or for life regardless of bond value performance.

Canada Life is introducing a one time underwriting process for group income protection in a bid to save time for advisers and their clients.

Group schemes with more than 20 members can now be underwritten only once, and if accepted, no further underwriting will be required regardless of increases in salary.

The UK government has announced details of a rescue package for the banking system worth up to £50bn.

The package includes key points such as the banks increasing their capital by £25bn and can borrow this to do so, an additional £25bn will be available in exchange for preference shares and £200bn will be available in short-term loans from the Bank of England.

This will initially be offered the UK's eight largest banks and building societies.

National Savings and Investments has cut interest rates by up to 0.2% from Tuesday on some of its variable rate deals, in order to maintain its share of the market.

This follows Northern Rock after it withdrew some of its saving offers. Both have 100% guarantees on deposits, whereas the safety threshold was increased to £50,000 as of today.

UK shares have fallen, with the FTSE 100 down 5%, as investor concern grows for the health of European banks.

The crisis in Iceland has seen six of its financial institutions halt trading. In Germany, plans to protect its citizens amid fear over its banks have been agreed but there are no plans to back this with legislation.

The FTSE fell to 4732.2 in afternoon trading.

The Financial Services Authority (FSA) has raised the limit to the amount of deposits that are guaranteed should a bank go bust to £50,000, through the Financial Services Compensation Scheme (FSCS).

The limit is per customer so joint accounts will be guaranteed up to £100,000. Earlier in the week, the Irish government introduced an unlimited guarantee. The new limit will come into force on Tuesday 7 October.

The Irish government's move to guarantee all deposits in its banks has been passed by the Irish parliament.

The government's 400bn euro guarantee covers Allied Irish, Bank of Ireland, Anglo Irish, Irish Life & Permanent, Irish Nationwide Building Society and the Educational Building Society. This may also be extended to foreign banks such as Ulster Bank and National Irish Bank which are owned outside of the Republic of Ireland.

Mortgage lender Bradford & Bingley is to be nationalised, the government has confirmed.

The government will take control of the bank's £50bn mortgages and loans, while B&B's £20bn savings unit and branches will be bought by Spain's Santander for £612m.

Insurance giant AIG has signed the terms of its $85bn deal with the Federal Reserve, that is helping the company stay afloat.

Under the two year agreement, the central bank will have a 79.9% stake in the insurer and apply a steep 8.5% above the rate of the three month LIBOR interest rate on the loan.

The FTSE 100 rose steeply this morning, rising 7% to 5,218 in reaction to news that the FSA has banned short-selling of financial Stock.  Shares have also lifted by US plans to rid American banks of their bad debts.

Royal Bank of Scotland rose 44%, HBOS rose 36%, Lloyds TSB 33%, Barclays 27% and Prudential 15%.

Lloyds TSB has revealed it has bought HBOS for £12.2bn after yesterdays speculation.

HBOS shareholders will receive 0.83 Lloyds TSB shares for every 1 HBOS share. Existing Lloyds TSB shareholders will own approximately 56% of the group.

Lloyds TSB is in advanced talks with HBOS to create a UK retail banking giant worth £30bn.

News of the merger has valued HBOS shares at 200 pence each and is thought a deal would end uncertainty about the strength of the UK's biggest mortgage lender.

The proposal has been approved by the Treasury.

AIG Life UK has suspended withdrawals from its standard fund and enhanced fund held within the premier access bond and premier bond.

The decision comes in response to market volatility over the past few days and an unusually high number of withdrawal requests.

Other policies issued by AIG Life are not affected.

Alliance & Leicester (A&L) bank shareholders have voted in favour of a proposed £1.3bn takeover by Spain's Banco Santander.

The proposal will offer shareholders one Santander share for three A&L shares as part of the deal planned for October. A&L will be merged with Abbey should the deal go ahead.

Bank of America is to buy Merrill Lynch in a deal worth $50bn, or $29 per share.

The company has written down more than $40bn of assets in the past year and there are worries that it could be the next bank to lose investors confidence.

The news comes shortly after Lehman Brothers announcing that it would file for bankruptcy protection.

The Abbey bank has become the latest high street lender to cut its mortgage rates.

It is now making fixed-rate deals cheaper for people who can put down a deposit of just 15%. The interest charged on some of their fixed and variable rate mortgages has come down by up to 0.6%.

Lincoln Financial Group has launched a new discounted gift bond.

The bond is linked to a discounted gift trust and allows settlors to mitigate inheritance tax by moving money out of their estate whilst still retaining an income.

The bond is available for those aged 18 to 89 but is targeted at retirees who hold an estate in excess of the £312,000 nil rate band. The minimum investment is £25,000 and the bond has a ramge of 21 funds.

Pearl Group has unveiled plans to restructure NPI's NPLL with-profits fund in a bid to boost long-term returns for policyholders.

The restructure will involve transferring NPLL fund to newly created fund in Pearl Assurance plc and has been approved by the NPLL with-profits advisory board.

It is hoped more than 400,000 policyholders could benefit from greater returns.

Abbey has added a new product to its FTSE 100 guaranteed investment range.

The guaranteed growth plan issue 17 has a guaranteed minimum return of 7% over three and a half years or 50% of the FTSE 100, capped at 35%. The plan's five and half year option offers a guaranteed minimum return of 21% or 50% participation in the FTSE 100, capped at 55%.

Both plans are available until December 2nd and have a minimum investment of £1,500.

The Bank of England has kept interest rates on hold at 5% for a fifth consecutive month.

Expectations however, suggest that rates are to be cut late in the year or in early 2009 in order to prevent recession and improve the economic climate.

Inflation meanwhile remains almost double the governments 2% target.

Norwich Union has reduced final bonus rates on its with-profits policies.

Payments on unitised policies have been reduced by 7.5% and conventional business payouts by 10%. No changes are being made to regular bonus rates and Market Value Reductions (MVR) are not being introduced.

Homebuyers will not have to pay stamp duty on properties costing £175,000 or less for the next 12 months.

The current £125,000 threshold will be raised as part of a package aimed at boosting the housing market. It is estimated that half of all property transactions will now be exempt from stamp duty.

Someone buying a home for £175,000 will save £1,750 under the scheme.

Tactica Fund Management is launching its three multi-asset funds on Cofunds.

The cautious, balanced and growth funds, which each have a diversified range of asset classes, including global equities, fixed income, cash and hedge funds will be available on the platform and for investment within SIPPs. A minimum investment of £2,000 is applicable to ISA investments.

US insurance giant Aon Corporation has announced that it is acquiring UK reinsurance intermediary firm Benfield Group in a deal worth £844m.

Aon will pay £3.50 per share in cash and assume £91m of Benfield's net debt. The deal will create an Aon Benfield Re brand.

About 35% more people are expected to be hit by Capital Gains Tax (CGT) this year as a result of the reforms that came into place in April.

Although it was hoped people would pay less CGT with the introduction of the new 18% flat rate, an estimated 90,000 people are expected to pay CGT this year due to the removal of indexation and taper relief.

Standard Life is to enhance its SIPP offering by making its mutual fund supermarket FundZone available to its group and retail products. The SIPP will also be available to accept protected rights from October.

The offering allows advisers to embrace remuneration models for both upfront and ongoing advice charges, along with a wider fund choice for clients.

Fidelity FundsNetwork will accept applications for clients who wish to transfer protected rights into SIPPs from mid-September.

They will also be able to produce business illustrations for protected rights transfers the week before changes in regulation come into force on October 1. Clients will no longer have the frustration of splitting their pension funds.

Norwich Union is launching a new investment plan for customers who want to benefit from increases in the FTSE 100 while protecting their initial investment.

The plan is available with three and six year terms with maximum percentage rises capped at 27% and 72% respectively. The plans must be held for the full term for capital protection and investment returns and both versions require a minimum investment of £1,000.

The UK's annual rate of inflation rose to 4.4% in July, its highest level since records began in 1997, making it more than twice the level of the government's target.

The RPI index also rose, growing speculation that interest rates will have to be cut to ease pressure of accelerating inflation.

Research carried out by Legal & General shows that the cost of delaying a pension can costs thousands.

To achieve a pension income of around £20,000 a year at the age of 60, a 25-year-old would have to pay monthly contributions of £205. By delaying these payments until age 35, monthly payments would increase to £423 and cost around £40,000 as the chance of benefiting from investment growth is shortened. The research urged young people to consider starting a pension as the early contributions are the most valuable ones.

The Bank of England's Monetary Policy Committee has voted to keep the base rate at 5%.

The decision has invited mixed opinion with some criticising as inflation continues to grow above the governments 2% target. Yet others suggest that they are standing firm on trying to improve liquidity and allowing lenders to drop mortgage rates.

Towergate Financial has announced the acquisition of M2 Financial. The deal is Towergate's sixth acquisition to date with M2 Financial becoming the firms' East Midlands regional business.

Mark Howard, MD here at M2 said "...we have built a competitive and innovative proposition to clients and are confident Towergate Financial is the ideal partner to support us with the next phase of oor development."

Legal & General has extended its range of individual pensions by launching its Portfolio Plus Pension, available from IFAs, directly or on the Cofunds platform.

The contract will allow a maximum of 100 funds from a choice of 300 and also carries the flexibility of adapting the plan over time, for example incorporating a self investment facility.

Norwich Union has agreed a £1bn reattribution offer with policyholder advocate Clare Spottiswoode after long-running negotiations.

The deal will give one million policyholders the option of an average one off cash pay-out of £1,000 in return for sacrificing their right to future pay-outs from the inherited estate.

Scottish Widows has announced it is to lift property fund restrictions imposed on certain transactions out of life and pension property funds.

The 180-day delay period, put in place on January 2, will end on August 18. Lifting the restrictions will allow 6,000 policyholders to again make full or partial redemptions, transfers or switches.

Bright Grey is offering a 5% reduction on its business protection product as from today until October 31st.

The Bright Grey menu allows up to 10 covers within one plan allowing maximum flexibility. The provider contrinues to pride itself on its high service standards demonstrating their commitment to the market, both with IFAs and policyholders.

AXA has launched a 'Save More Tomorrow' service for its group personal and group stakeholder pensions, aiming to automatically increase the member's contribution by an agreed percentage at set time periods for the duration of the plan.

AXA believe the initiative will help member's to build a better pension pot to deliver a better income at retirement at key times, like pay rises.

Keydata investment services has launched a 100 per cent capital protected growth plan.

The new product provides full capital protection against falling markets and geared growth potential of 109.5 per cent of any growth in the FTSE 100 during its 6 year investment term. The plan has a minimum investment of £3,600 and is available as a stocks and shares ISA or within a SIPP or SSAS.

Zurich has introduced 18 new funds in order to provide clients with a greater number of investment options in the midst of volatile markets.

The new funds are now available to clients and internediaries through the Sterling Bond with Zurich's individual pension selection having 15 new funds. Money Market and Cautious Managed funds have been added to appeal to the cautious investor, while others include emerging markets and european.

Prudential has shelved its plans to carry out a reattribution on its with profits policies following months of actuarial modelling.

The reattribution involves shareholders paying current policyholders a one-off payment in exchange for them giving up their interests in any potential future distributions from the inherited estate.

Pru said maintaining the current operational model was best long-term for current and future policyholders rather than reattribution.

European Pensions Management has launched a SIPP with no Annual Management Charge which will run in conjunction with Selftrade, a SIPP dealing account  providing online and telephone dealing access.

The SIPP will also carry no charges for contributions on transfers in and a free protected rights facility. Over a thousand unit trusts and OEICS and forty fund managers at discounted rates are available.

Skandia is axing the Selestia brand and developing its platform into a full wealth management wrap under the name Skandia Investment Solutions.

Skandia say they are opting for unified branding and will also be developing a platform that advisers can use with their own branding. Skandia Investment Solutions will sit alongside the Skandia Life platform which continues to offer life and pension products.

HBOS has won backing from shareholders for its £4bn rights issue after a majority of investors voted in favour of the cash call.

2 shares can be purchased by existing shareholders for every 5 they own and at a discounted 275p per share price. Alternatively, shares can be sold if they do not wish to exercise their right to buy.

Barclays has confirmed it is considering selling shares to existing investors to raise cash. RBS recently raised £12bn through a rights issue and Barclays are looking to raise £4bn.

Shares jumped by 8% on news they were "actively considering" a rights issue.

The Royal Bank of Scotland has received a 95% take up of its £12bn rights issue, equivalent to 5,823,635,440 new RBS ordinary shares with valid acceptances. However, the remaining 299,375m shares are to be placed at 230p per share for which valid acceptances have not yet been received.

Nottingham Friendly Society has launched a new stocks and shares ISA with ethical, UK and global investment options.

The tracker select ISA will cost £25 a month or £250 as a lump sum. Investors who who contribute more than £1,000 become members of the society and are eligible to apply for annual payments from its additional benefits fund, with the possibility of claiming for optical, dental and medical costs of up to £30.

UK interest rates have been left unchanged at 5% following the latest Monetary Policy Committee meeting. The decision to hold rates had been widely expected amid concerns over the pace of inflation.

However, the economic slowdown and falling house prices had led some to call for another rate cut to boost spending.

Barclays Bank is set to cut the charge levied each time customers go beyond an agreed overdraft limit. The penalty will change to £8 for each transaction made while in the red without permission, from a levy of up to £35 a day. The bank is also offering a temporary authorised overdraft extension for £22.

The changes, happening in August, comes as eight banks prepare to defend their charges in the High Court.

Losses and a warning of tougher times ahead have sent shares tumbling at Bradford & Bingley.  Its shares fell 24% after it recorded a £8m pre-tax loss in the first four months of 2008, compared with a £108m profit this time last year.

B&B blamed problems with with buy-to-let mortgages and borrowers struggling with loan repayments.

LV= has launched a new income protection product designed to replace mortgage payment protection insurance. The product pays out until the policyholder returns to work, the plan term ends ot the policyholder dies.

It has guaranteed premiums and offers cover for accident, sickness and unemployment with level mortgage payment protection. The policyholder can claim as often as necessary.

A banking scheme for one-day cash transfers by telephone or on the internet was launched today. The scheme, developed by 13 banks, will speed up the process which previously took up to four days to transfer money between banks.

The same-day project will be extended to standing orders from 6 June.

The price of oil hit a new record high at $135 a barrel - more than twice the cost compared to this time last year. The latest surge was driven by speculation that US supplies of crude have fallen and traders are taking profits.

The higher prices have pushed up prices of fuel, energy bills and food.

American International Group (AIG) shares fell to their lowest level for a decade after revealing it is to raise $20bn through the sale of shares and bonds. £9.1bn of bad debts were recently written off from its US mortgage-backed investments.

AIG shares fell to $37.88 on the NYSE.

Aegon has launched a new at-retirement solution aimed at bridging the gap between annuities and income drawdown.

Built on their '5 for Life' product, it is aimed at those aged between 55 and 75 who have over £50,000 of pension savings and who do not want to relinquish investment and inheritance control but still want a guaranteed income.

UK consumer inflation reached its highest level in 13 months driven by high food and fuel costs.

The CPI hit 3% on a yearly basis in April, up from 2.5% in March. The Retail Price Index (RPI) was also up 0.4%. It is likely to stop the Bank of England cutting interest rates.

UK interest rates have been held at 5% as the Bank of England decided to focus on inflation risks, despite signs the economy may be slowing.

Rises in fuel and food costs have seen inflation rise above the Government's target and although the decision was expected, though rates in June are forecast to be cut to 4.75%.

The Norwich Union brand name is to be phased out in the next two years in favour of Aviva.

Aviva is looking to unite under one brand to compete globally as over 60% of the group's business is now derived from outside the UK. The investment arms are due for change first with general insurance and life arms to follow.

Hartford Life have added seven new funds and two asset classes to its personal pension product, with investors in the Hartford platinum and the trustee investment plan gaining access to international property and commodities asset classes.

There are now 97 funds available through these plans all with an optional guarantee.

Invesco Perpetual has launched a European High Income Fund with a target yield of 6%. The fund seeks to achieve a high level of income and long-term capital growth by investing in continental European equities and bonds.

The minimum investment is £500 lump sum or £20 monthly premium.

M2 Financial Limited has been named as the Group Pension IFA of the Year by FT Business at the Financial Adviser Life & Pensions Awards 2008, thanks to the expertise of Sales Director, Mitch Hopkinson.

The awards, sponsored by Aegon, were held on 23rd April when  the award was presented to Mitch, along with Managing Director, Mark Howard.

Aegon Scottish Equitable has launched a guaranteed onshore bond to protect consumers against stockmarket volatility. The 'Investment Control' product offers an option to guarantee investors' money back after 5 years, less withdrawals, and on death. In addition every five years after the tenth anniversary,  if the fund value is more than the amount invested, less withdrawals, a new higher guaranteed cash-in amount is set.

90 funds are available under this contract.

The Bank of England has agreed to bolster the UK mortgage market by swapping £50bn of government bonds for banks' mortgage-backed securities, in an attempt to encourage the banks to lend between themselves and improve liquidity in the market.

It is expected that the swap will undervalue the mortgaged-backed securities in order for the risks to remain with the banks and are not passed onto taxpayers.

UK unemployment fell by 39,000 to 1.61 million in the three months to the end of February, according to ONS figures. Employment figures stood at 29.5 million, the highest since records began in 1971, and as such, the number claiming jobseekers allowance was down to its lowest since 1975.

The ONS suggested that overall the labour market remained in fairly good health.

JC Flowers is refusing to increase its 150 pence per share offer for Friends Provident and has threatened to officiallly withdraw if Friends do not open discussions.

However, JC Flowers reserves the right to increase its offer should a third party offer an equal or higher offer.

UK interest rates have been cut to 5% from 5.25% by the Bank of England, the third cut since early December. The cut had been widely forecast by economists.

UK mortgage lenders responded quickly by cutting the standard variable rate mortgages by the full quarter of a percentage point.

The Bank of England's interest rate-setting body is due to begin its latest meeting amongst expectation that rates will be cut.

Amid signs the global credit crunch is contuning to hit the UK, the Bank's Monetary Policy Committee is tipped to trim rates by 0.25% to 5%. Rates are to be announced on Thursday.

Bright Grey has boosted its guaranteed rates by adding indexation to life and critical illness cover in a bid to guard against inflation.

Indexation can be added at a fixed rate between 2% and 5% on guaranteed or RPI linked rates and  the maximum term has also been increased to 40 years.

Abbey has announced it has withdrawn its 100% loan to value mortgage until further notice. Several other criteria and rate changes has also been made. Fixed rates are to increase between 0.11% and 0.37%, making its best two year fixed rate at 90% LTV at 5.99%.

Abbey defended its decisions saying it was moving "in line with recent moves by other lenders."

US private equity firm JC Flowers has been given a deadline of 30 April to make a firm offer for Friends Provident following a Takeover Panel ruling.

A new offer must be received by the Panel by this date after Friends declined the previous offer of £3.5bn and their proposed merger with Resolution fell through.

First Direct has temporarily stopped offering any of its mortgages to new customers.

The bank, part of HSBC, said its withdrawal was to cope with unprecedented demand for its range of mortgages  instead of increasing rates to simply deter customers. Business will resume as normal once the backlog has cleared.

NatWest International is offering investors a guaranteed structured deposit account which provides protected capital and a diversified portfolio.

The Autopilot Account protects the initial investment providing it is deposited for a five year term. It comprises of developing and emerging equity markets, property and gold and requires a minimum deposit of £10,000.

Friends Provident has rejected a £3.5bn takeover offer from US investment firm JC Flowers, claiming the offer significantly undervalued the company and did not "represent a basis for discussion".

The offer of 150 pence per share was 25 pence per share less than what was being considered back in January.

Friends Provident International has made two more New Star funds available through its Premier, Ultra, Elite and Zenith products.

The New Star Global Financials and Tactical Portfolio funds will be added to the existing international funds and will be available in US dollars.

The number of banks lending mortgages is 33% down on this time last year according to the British Bankers Association (BBA).

Up to 50% of the 43,870 bank mortgage approvals made in February were for customers looking for more favourable deals on their existing property, rather than those who wanted to move house.

The Financial Services Authority has outlined areas in which the supervision of banks could be improved following the Northern Rock crisis.

The FSA called for more staff and upgrades in training in competence of firms management. However, it stood by its philosophy of operating within a principles-based regulatory framework rather than rules-based.

The UK's financial watchdog, the Financial Services Authority, has attempted to quash rumours spread in the City over firms and the banking system. The FSA said it would "not tolerate" traders starting false rumours in order to make cash from dealing in their shares.

Shares in HBOS fell 17% yesterday and they have supported the FSA's action in investigating the alleged market abuse.

Old Broad Street Research has launched a new ratings website that will offer users enhanced features to help pick the right fund. These include an expanded universe of funds and charting tool, as well as independent research into OEICS, unit trusts and multi-manager funds free of charge.

Funds can now be picked on a like for like basis, with multi-manager funds being split into five categories based on how they do in rising and falling markets.

European markets took a tumble yesterday amid investor fears that the collapse of Bear Stearns could hasten the onset of a worldwide recession.

The UK FTSE 100 slumped by more than 3% and the Bank of England injected £5bn to boost lending amongst banks to ease the crisis. A positive session in Asia has resulted in the index rebounding, up 1.8%.

The price of gold reached a record, trading at $1,000 an ounce for the first time, pushed higher by a weak US dollar and fears about the US economy.

Fears of recession have seen a surge in commodities, deemed as alternatives to shares and currency. The value of gold has risen by 20% since the beginning of the year.

Norwich Union has been told to make a cash offer to buy out policyholders' remaining share of a surplus in two with profits funds.

It was announced in February that 1.1 million policyholders would see bonuses of £2.1bn added to policies, but the remaining amount remains in dispute. They have been advised to make an offer and let policyholders make their own decision.

Alistair Darling gave his first budget speech as Chancellor announcing various prices rises and pledges, insisting the UK could "weather economic storms".

No further U-turns on capital gains tax or non-domiciled residents were made, bur he was forced to cut economic growth forecasts by 0.25% and announced a big increase in Government borrowing over the next two years.

There were the ususal price rises on alcohol, cigarettes and road tax.

Insurance company Friends Provident has unveiled a £46m annual loss, compared with a £400m profit from 2006.

They are however, to continue with their strategic review despite this loss and takeover speculation with JC Flowers, who are yet to make a formal bid.

The Bank of England rate-setting Monetary Policy Committee has decided to keep interest rates on hold at 5.25%, a decision in line with analyst and market expectations.

The European Central Bank also decided to leave its main interest rate on hold at 4% as it tries to balance inflation and growth.

The national minimum wage is to rise to £5.73 per hour in October, an increase of 3.8%, the Government has announced. Increases are also planned for 16 to 17 year-olds and 18 to 21 year-olds.

More than one million people are set to benefit from the increase, two-thirds of which are women.

Standard Life has launched a new discretionary trust to be available with the estate planning loan plan, discounted gift plan and gift plan on an onshore and offshore basis.

Under this trust, no beneficiary has a right to income or capital and the trustees decide who benefits from the trust.

Aviva is to restructure its asset management business to create a single, globally integrated asset management, to be known as Aviva Investors.

The business is to transform the existing management model to deliver greater specialisation and focus in growing its funds under management and investment capabilities.

The UK's largest bank, HSBC, has revealed it has made a £8.7bn loss on investments linked to the credit crisis, the biggest write-down of the big-five UK banks.

Although these losses are higher than expected, annual profits still rose 10% to £12.2bn, with an increase of 11% to shareholders dividends.

House prices fell in February by 0.5% according to the latest survey from Nationwide, the fourth consecutive month in which prices did so.

The average UK home now costs £179,358, with the annual rate of house price inflation falling to 2.7%, the lowest since November 2005.

The price of oil has hit a new record high, touching $102.08 a barrel, continuing the upward trend due to fears that Opec will cut supplies.

The surge is also supported by investors switching their cash from shares and currencies to commodities, as generally they are considered a hedge against inflation.

The US dollar has fallen to a fresh record low against the euro amid concerns that further interest rate cuts will be needed to stem a US recession. The euro rose to $1.5048.

The Fed slashed interest rates to 3% last month and with consumers not expecting conditions to turn around, the outlook remains bleak.

Reports have emerged that Lloyds TSB is targeting rival bank Alliance & Leicester following the announcement of its strong full-year profits of £3.9bn.

However, it is also understood that Bradford & Bingley, another casualty of the credit crunch, may also be in line by Lloyds TSB. Formal board talks are still due to take place.

The last lender offering so called 125% mortgages has pulled them out of the market. Birmingham Midshires blamed "market factors" for their decision to withdraw, following five other lenders last week.

The mortgages allowed first time buyers to get on the property ladder without deposit, taking on significant debt.

Oil prices have closed at a record high for the second consecutive day with the price per barrell at $100.74.

Blames are pinned on worries that Opec producing countries might announce production cuts at their meeting on March 5th, as they are worried that the slowing US economy is reducing the demand.

UK bank Alliance & Leicester has reported a 30% drop in annual profits following market turbulence and has predicted a challenging year ahead.

Pre-tax profits were down £170m to £399m in 2007, and after the announcement, shares also slumped by 14%. A&L has been one of the many banks to be affected by the slowdown in the US housing sector.

Bright Grey has launched a new business protection product which offers cover for key person, loan protection and ownership protection. The policy also  includes key person income cover for sickness, designed to protect employers from loss of profit if a key person becomes too ill to work.

Underwriting limts have also been reviewed with life cover up to £1 million and critical illness up to £350,000.

Emergency legislation is to be introduced to temporarily nationalise Northern Rock, despite last week naming Virgin as the frontrunner to takeover the stricken bank.

The government claims private bids do not offer the taxpayer "sufficient value for money", but will only remain publicly owned temporarily, with plans for a private sector takeover to follow when the market is more favourable.

The Virgin-led consortium has been named the frontrunner to take control of Northern Rock by the Treasury, despite seeing nationalisation as a better outcome.

As such, Virgin has been told to improve its proposal, offering more for the billions in financial support being provided by the government.

Fidelity FundsNetwork is offering an ISA for nervous investors reluctant to immediately commit funds to equities or bonds but who still wish to make full use of their £7,000 tax allowance.

Available from mid March paying 4.96% AER, investors who are nervous about the stock market can make use of their allowance without being subjected to unwanted risk, transferring their balance from deposit to equity at a later date.

Swiss banking giant Credit Suisse has reported a 72% dive in quarterly profits, with net profit to the end of December of £619m.

Despite losses on sub-prime investments being less than expected, the company still anticpates a "challenging environment" in the near future following similar performances by Swiss rival UBS.

The Treasury Select Committee has suggested that banks are attempting to boost their profits by taking cards from reliable customers and giving them to riskier ones.

Withdrawing cards from those who pay their bills on time and supplying them to customers who will incur interest for non payment of debt has been denied by Apacs, who claimed that credit levels needed to be 'rationalised'.

Investors demonstrating a reduced appetite for risk in the current volatile markets and a demand for funds providing exposure to commodities has led to a surge in fixed interest investments, according to Skandia.

M&G High Interest, Merrill Lynch Gold & General & JP Morgan Natural Resources were among the most popular funds.

The Bank of England is expected to cut UK interest rates by a quarter of a percent to 5.25%, with an announcement due at midday today.

However, ongoing concerns about inflation would prohibit large rate cuts, like in the US, despite predicitions that rates will continue to fall throughout the year.

Norwich Union with-profit policyholders are to share a bonus of £2.1bn, with shareholders due to receive £230m.

The payout will be made in instalments over three years and will add 10% to policy values. Further negotiations are to take place about how the remainder of the surplus is to be divided.

Threadneedle has agreed with Invesco Perpetual to acquire its full service defined contribution pension business with total assets of £470m.

Threadneedle's intention is to grow its defined contribution business and says IP's transferred clients will gain access to broader range of funds, improved systems and web functionality.

Up to three potential rescuers of Northern Rock are expected to submit formal bids for the bank ahead of today's deadline.

Virgin Group, Olivant and the bank's management are expected to put forward proposals. The government wants a private sector rescue, where under such a sale, the government would return £25bn of Bank of England loans, essentially taxpayers money.

HM Revenue and Customs (HMRC) has extended the self assessment deadline after problems with its online service.

Their website was down for several hours on the deadline day, with taxpayers facing an automatic £100 penalty if they missed the midnight deadline. HMRC has now confirmed any returns filed by midnight Friday will not be penalised.

Britons have increased their savings levels 40-fold during the past 50 years, with £43.9bn set aside, compared to £1.1bn in 1957, according to National Savings & Investment.

The average household now saves £633 per annum, with 28% of savers now using internet banking. The NS&I research suggests that savings could rise to £1,767 per annum by 2057.

Standard Life has announced that an estimated £800m of bonuses will be added to its with-profits plans in 2008, with their with-profits bonus declaration stating the growth rates will increase by 0.5% to 2.5% per annum.

Unit price growth guarantees will remain unaffected, standing at the guaranteed rate.

UK households spend more of their budget on housing and less on food, the opposite of 50 years ago, with 19% of spending relating to mortgage interest payments or rent, according to the Office of National Statistics. Meanwhile, spending on food and drink fell to 15% of the weekly budget.

However, despite recent increases in energy prices, spending on fuel and power has halved to just 3%.

Aviva may abandon plans to offer windfalls to more than a million policyholders if it cannot agree a deal within the next few months, over its plans to divide a £5.2bn surplus built up in its Norwich Union with-profits fund.

The "reattribution" of cash will be offered in return for giving up their right to any possible future payout from the "inherited estate".

French bank Societe Generale says it has uncovered "massive" fraud by one of its traders which resulted in a loss of £3.7bn.

The bank said the fraud was based on simple transactions that had been concealed by "sophisticated techniques". The losses are four times greater than those made by Nick Leeson at Barings Bank. SocGen have yet to confirm reports naming the trader.

The government is set to unveil details of proposed changes to Capital Gains Tax (CGT), including scrapping taper relief and setting a single 18% rate.

It is also tipped that the rate may be halved to 9% on gains of up to £750,000 to help small firms. The proposals are set to be enforced on 1 April 2008.

The US Federal Reserve has slashed interest rates to 3.5%, its biggest cut in 25 years, in a bid to stop the US economy from slumping into recession and to curb falling indexes across the globe.

The FTSE 100 however, recovered closing 2.9% higher after falling by 4% earlier. The French, German and US indexes still fell, but not at such a dramatic rate.

Standard Life has launched a discretionary investment management business, targeting wealthy individuals, charities and small or executive pension schemes.

Standard Life Wealth will follow 'goal-based absolute return strategies' to tailor portfolios to meet client requirements, with £2m of investable assets of which £1m is liquid.

Chancellor Alistair Darling has outlined details of a funding plan that could help facilitate a private sale of Northern Rock.

The proposals would see the bank's £25bn Bank of England loan converted into bonds and sold, effectively turning debt into government or hilt-edged stock. However, bidders still have until February 4 to set proposals.

A rush to withdraw money from its commercial property funds has forced Scottish Equitable to introduce delays of up to 12 months for its customers, affecting the Property, Select Reserve and Select distribution funds.

They have followed suit of Friends Provident who took the same action last month, blaming recession worries and interest rates. Regular income payments, retirements and death claims will not be affected.

Six new funds from Seven Investment Management will now be available through Fidelity FundsNetwork, adding the income, moderately cautious, balanced, moderately adventurous, adventurous and ethical funds.

The new funds will bring the total number on FundsNetwork to 1,100 from over 60 providers.

Shares in UK buy-to-let mortgage lender Paragon have plummeted by 39% after they revealed plans to raise £287m to ease their funding crisis.

Paragon plan to raise the capital in a rights issue in order to repay the banks who lent them money after the credit crisis hit their normal sources of finance.

Foreign & Colonial could soon become the centre of a takeover battle, after reports claimed that majority shareholder Friends Provident is looking to sell its investment arm following a strategic review.

Friends is understood to be keen to raise capital after the collapse of the merger with rival company Resolution. Threadneedle Investments and Henderson Global Investors are thought to be interested.

Northern Rock has agreed to sell its portfolio of lifetime equity release mortgages to JPMorgan for £2.2bn, which represents around 2% of Northern Rock's total assets as at June 2007.

The proceeds of the sale are to be used to reduce its current funding from the Bank of England.

The Bank of England has decided to keep UK interest rates unchanged at 5.5%.

The Bank faced a tough decision, having to balance signs of a slowdown in consumer spending against growing inflationary pressures. A cut would have increased consumer confidence but would have risked fuelling price pressures driven by higher energy and food bills.

Resolution shareholders voted in favour of going ahead with the Pearl deal yesterday at an extraordinary general meeting, with a 96% majority voting in favour of the cash acquisition.

Pearl is to pay 720p per share in the deal worth £5bn and is expected to complete on February 4th 2008.

The price of gold has soared to an all-time high of $881.28 an ounce, driven by the weak dollar, strong oil prices and global inflationary fears.

Gold has become cheaper for holders of other currencies as the dollar weakens and is seen as a haven in times of uncertainty and oil-led inflation. Its price has increased by over 30% in 2007.

House prices in the UK grew last year at their slowest rate since 1996, according to the Halifax bank, claiming prices rose by 5.2% in 2007, taking the average UK home to £197,039.

Prices rose 1.3% in December, the first rise in the last four months, but overall the market has been going through a sharp slowdown under the impact of higher interest rates.

Standard Life has been awarded a 'AAA' rating by fund agency OBSR for its outperforming UK Smaller Companies Fund.

The fund is currently placed second in the IMA UK Smaller Companies sector  over the past three years having returned some 87.1% compared to average of 44.9%.

The chancellor is to give the Financial Services Authority more power to deal with failing banks in an attempt to avoid another Northern Rock-style crisis, by May 2008.

The proposed powers would include being able to seize and protect customers' cash if a bank got into difficulty and to separate failing parts of a bank from the healthy parts, redepositing cash to another bank.

Spanish banking giant Santander has not ruled itself out of plans to buy Alliance & Leicester, despite battling over price.

Santander has actively seeking to increase its UK presence as it nears completion of its three-year integration plans for Abbey National and A&L is thought to be takeover target due to doubt over its liquidity.

Insurer Friends Provident has told investors in its £1.2bn property fund that they must wait to access their money because of a market downturn.

It said they had taken this measure to avoid selling commerical property in a hurry at low prices, telling investors that they must now hold off for six months before accessing any cash.

Fidelity FundsNetwork has reached over £900m of SIPP and onshore and offshore Investment Bond assets.

It now takes more than 7% of new SIPP sales after two years in the life and pensions market. Sales of external funds via IFAs are also up 38%, increasing assets to £13bn.

The percentage of landlords selling their properties is at a three-year high, according to the Royal Institution of Chartered Surveyors (Rics).

Oversupply of flats, previous interest rate rises and the credit crunch have all led to a cautious stance from lenders. Property sales made after tenants' leases expire rose to 6.5%, the third consecutive increase and the highest level since January 2005.

Campaigners have welcomed a £2.9bn rescue package for 140,000 workers who lost their pensions when their companies went bust.

Plans set out by Work and Pensions Secretary Peter Hain aim to restore 90% of the value of their pensions (subject to a £26,000 cap), to bring them in line with those covered by the Pension Protection Fund (PPF).

Olivant Group has been given equal footing to Virgin Group in the bid for Northern Rock after it threatened to walk away from the bidding process.

Virgin Group-led consortium has been stripped of its status as the preferred bidder after Olivant met representatives of the Treasury, the Bank of England and the FSA.

Chancellor Alistair Darling has confirmed that any revisions to the Capital Gains Tax (CGT) changes will not be announced until next year.

It was announced in October that taper relief would come to an end from 1 April 2008 and a new single 18% band would apply. However, the personal annual CGT exemption of £9,200 will remain.

The European Central Bank, the Federal Reserve and central banks from the UK, Canada and Switzerland have committed to provide billions in loans to banks in a bid to lower interest rates and credit availability.

The Bank of England will increase the amount offered, providing £11.35bn instead of its original £2.85bn. It comes after rate cuts by both the Bank of England and the Fed had failed to reduce inter-bank rates.

Northern Rock is expected to be dropped from the FTSE 100 index of leading London shares, reflecting the magnitudde of the credit crisis.

It is now likely to sit at the bottom of the FTSE 250 as it is thought that investment funds will be forced to sell shares if it is demoted.

Falling share prices are to blame for pushing the UK's defined benefit pension funds back into deficit last month, according to the Pension Protection Fund (PPF).

7,800 defined benefit schemes were together £5bn in the red, the first collective deficit since November last year. However, the overall position of pension funds is still better than a year ago when the total deficit was £30bn.

Lloyds TSB have revealed that losses from investments linked to the US sub-prime mortgage crisis will cost £200m in the current financial year.

However, they remain confident that full-year profits will be in line with their expectations despite the sub-prime hit, unlike many of their rivals who have reported higher losses.