Personal Finance. Money. Investing.

Last week a row erupted over ATMs in the UK. While Link announced that the fee paid each time a cash machine is used will be cut from Sunday, consumer champions Which? claimed that 300 ATMs are closing every month.

Stuart Rye, Director of business development for financial services at Fujitsu UK, believes that it’s vital to ensure a spread of ATMs across the regions that addresses consumer demand and for ATM networks to look to technology to lower costs.

“Even as we move towards a cashless society, ATMs still play an important role in the financial life of Brits across the country, and reduced access might have unpredictable consequences for a number of industries besides the financial services – such as retail and hospitality – as well as for consumers.

“There is clearly a mandate for a more homogenous spread of ATMs across all regions, but if closures need to happen, they should be done in a strategic manner that still takes into account ATM supply and consumer demand. Other countries, such as Sweden, have developed cashless economies that work well for everyone, but we would need a more sophisticated ecosystem to do this in a cost effective and efficient way – ATMs are still vital.

“Maintaining an ATM estate can be challenging, with cash replenishment and machine maintenance involving high recurring costs. However, there are other ways to lower these costs; investing in technology can help create power and energy savings and better install and maintenance processes. At Fujitsu, we’re looking at how we can use AI and advanced computing techniques to optimise cash management, a development which could reduce the cost of cash handling and create a more efficient ATM network.

“Ultimately, this is a complex issue involving numerous important stakeholders – banks, retailers, consumers, and ATM businesses. It’s tough to get it right, and requires a considered approach which takes into account those parties needs now and the trends that will determine their needs in the future.”

Ivan Gowan, CEO at, looks at the new regulations and asks whether they are all in the best interests of the consumer.

First the boring bit – or perhaps not. On 3 Jan 2018, the European Securities and Markets Authority (ESMA) received product intervention powers, as the Markets in Financial Instruments Regulation (MiFIR) came into force. This allows ESMA to temporarily dictate regulations across all 28 EU member states, either in support of or overruling the National Regulator – in the UK’s case the Financial Conduct Authority (FCA). On 27 March, ESMA decided to use these new powers to intervene in the market for CFD trading. As with many new regulations, the broad direction is to be welcomed – providing much needed protection for consumers – but flaws in the detail could lead to unintended negative consequences.

The intention is to protect unwary and inappropriate consumers from taking on risks they don’t understand and suffering disproportionate financial losses. This is a laudable intention in anyone’s book and responsible CFD providers will already be compliant with much of the detail in these recommendations. CFD providers already have a responsibility to help retail investors manage their risk and align it to their ability to withstand any financial losses. ESMA’s temporary measures provide a salutary reminder and an improved yardstick for providers to measure themselves against getting this balance right.

The central aspect of a CFD which provides both the main risk and the main benefit is the ability to take a relatively large financial position with a smaller upfront margin payment – what’s called leverage. ESMA measures include putting a leverage limit on the opening of a CFD. This level varies according to the volatility of the underlying instrument, from as little as 2:1 for cryptocurrencies to 30:1 for major currency pairs. They also include a margin closeout rule of 50 per cent of the initial required margin, meaning the position must be closed as it moves against the client. Very sensibly, negative balance protection is mandated, which prevents a client from losing more than their deposit – this is already a common aspect of dealing with most reputable providers. ESMA also recognise the importance of new clients to the industry fully understanding the likelihood of success and are proposing the use of a specific warning that details the win/loss ratio.

This all seems very sensible, doesn’t it? So, where is the issue? Well, there are two interlinked issues here. What makes the CFD a popular way of trading the financial markets and hedging out other risks is the leverage it offers - the ability, as mentioned earlier, to take a relatively large financial position with a smaller amount of upfront margin. Clients enjoy using leverage sensibly. Coupled with the risk mitigation measures already offered by reputable providers in the industry, or now mandated by ESMA going forward, clients should be free to use appropriate levels of leverage commensurate with their knowledge and experience. The industry has a responsibility to help ensure they do not over-expose themselves to risk, which is done by way of thorough questionnaires designed to establish their understanding of the risks and practicalities of CFD trading. Responsible CFD providers are increasingly developing platforms that offer users an experience in line with their ability to manage risk. CFD providers can offer less experienced users lower levels of leverage as those users gain the necessary knowledge and experience to take on larger trades. This approach, though not mandated, could and should form part of the provision of a responsible trading environment.

The corollary to not offering appropriate and desired levels of leverage to more experienced users, and the main unintended consequence is that clients simply go somewhere else – somewhere where the protections are either lower or non-existent. But where? Well, in the world of the internet, unscrupulous trading providers abound – either real platforms, simply unregulated, where behaviours are questionable at best, or sophisticated financial scams, with no underlying trading ever taking place – think Wolf of Wall Street. Since February, the FCA has warned about three firms operating illegally in the UK, but unfortunately the FCA website is not bedtime reading for many. But these providers appear to offer users the levels of leverage they seek, levels which the reputable providers are being forced to withdraw.

So, what is the answer? A mix of the above, with the best outcome for the consumer at the heart of all changes; regulations that allow and encourage compliant CFD providers to offer consumers what they seek, while presenting them with risk mitigation tools and targeted education to allow them to go on enjoying the trading experience in a controlled environment – while understanding the likelihood of ultimate financial success. Good regulations will encourage innovations which benefit the consumer, such as some of those we have seen in the recent past: stop losses and limits, which ensure that a trader’s position will be closed as soon as their losses or profits reach a specific point: alerts to notify them when a market hits a certain price, providing them with either an exit or entry point in a specific market: or the game changing developments in mobile app trading.

So, in summary, the ESMA regulations will help to create a level playing field between responsible CFD providers and mandate a number of measures to protect consumers from irresponsible risks. However, the medicine here could be worse than the ailment if the impact of overly restrictive levels of leverage is to drive consumers offshore to unscrupulous operators, where there are no protections and the likelihood of losing your money is 100%. ESMA should consider the imposition of leverage restrictions not as a standalone, but in the context of the other protections in place. Insisting CFD providers make a responsible assessment of the level of risk that a retail trader can take, alongside negative balance protection and the margin closeout requirement, should enable levels of leverage which will keep traders onshore, protected by a compliant industry with a vested interest in sustainability and longevity.

Finance Monthly hears from Linda Moneymaker, Branch Manager and Loan Officer at Anderson Brothers Bank’s Summerville office, who introduces us to the bank’s history and tells us what makes it the preferred choice among clients in South Carolina.

In 1933, Mr. Ernest Anderson and his brother, Mr. Bishop Bonar Anderson, responded to the needs of several tobacco warehousemen from Mullins, South Carolina who requested financial assistance. The two brothers established Anderson Brothers Bank in the back of the Anderson Warehouse in Mullins. This small office was used to loan money to warehousemen so they could issue checks to farmers immediately following the sale of tobacco. Loans were paid off as tobacco companies such as Reynolds, American and Imperial paid the warehouses several weeks later for the tobacco purchased. The small office quickly evolved into a depository and eventually moved to Main Street, across from the Bank’s present main office in Mullins. Today, under the leadership of Mr. Ernest Anderson’s grandsons, Anderson Brothers Bank remains family-owned and operated. David E. Anderson serves as President and CEO, joined by his brothers Neal, Chairman of the Board, and Tommy, Vice President.

Anderson Brothers Bank has grown from a small operation in the back of a tobacco warehouse to 22 branches throughout the Pee Dee, Coastal and Lowcountry regions in South Carolina with over $650 million in assets. Despite our continuous growth, we have remained committed to our customers by providing innovative financial products and services that meet their needs, while also being heavily involved in our communities through outreach programmes, sponsorships and donations to civic organizations.

Before joining the Anderson Brothers Bank team in March 2017, I spent 20 years in Banking and 13 years in Consumer Finance, holding positions from entry-level customer service to management. When Anderson Brothers Bank decided to expand into the Summerville area with a brick-and-mortar location, they asked me to consider joining their ‘family’ as Branch Manager. I knew it would be a welcoming change to be empowered to help my customers. Over the course of a year, we have hired great talent and we continue to integrate successfully in the competitive Lowcountry banking market. Our customers even tell us that we are ‘the friendliest bank in town’ in which we take great pride.

Through my years of experience, I have found that listening to my customers so I can fully understand their needs is the key to my success. As a matter of fact, I am blessed to have customers refer their friends and family to me based on how I treat them from the moment they enter our lobby. This is also part of Anderson Brothers Bank’s motto of ‘treating you like family’.  Above all else, I realise my achievements as a Branch Manager and Loan Officer is a result of a team effort at ABB.

Our Summerville branch’s strip mall location is the first of its kind with Anderson Brothers Bank and is related to cultural influences by this generation of consumers who require less face-to-face interaction and increased mobile and online banking. While we provide a wonderful, friendly lobby atmosphere in which to bank, we also offer innovative mobile and online banking, online mortgage application and will soon offer online account opening and a deposit-taking ATM in place of the standard ATM in our branch parking lot. Anderson Brothers Bank has built its reputation on helping individuals, families and businesses as they journey along life’s path and, here at the Summerville branch, we strive to maintain that status. While larger, corporate banks continue to acquire smaller, hometown banks, we remain family-owned, a place where employees know our customers by name and business is often conducted on the strength of a handshake.


Three in five (60%) people surveyed by Masthaven bank believes that they would find it hard to get a mortgage today - half (50%) of UK homeowners surveyed feel this way, indicating some may feel like mortgage prisoners.

According to a new report by challenger bank Masthaven, the mortgage market is not in tune with modern consumers' evolving needs; the world has changed and the mortgage industry needs to play catch up. Today the bank publishes new data which indicates that UK householders sense a ‘computer says no’ mentality from mortgage lenders.

Masthaven’s Game of Loans report found many people surveyed believe they wouldn’t get a mortgage today. The poll, conducted by Opinium, reveals that both would-be and existing homebuyers are unsure if lenders would support them: 60% of the adults surveyed believe that if they were to buy a home today, it would be hard to get a mortgage. The bank is concerned that half (50%) of all adults who are homeowners surveyed feel this way; and it’s worried that they may feel like mortgage prisoners.

The new study - comprising two surveys of over 2,000 UK adults, in January and July 2017 - found that almost two in three (65%) people polled believes that getting a mortgage is about ‘box ticking’ not the reality of someone’s situation. This opinion has risen markedly by ten percentage points (from 55%) since the first poll in January.

It also highlights how people feel the mortgage market must adapt to appreciate their changing lives – a large majority (81%) of people surveyed believe lenders should make an effort to understand homebuyers’ individual circumstances. This view is strong among people aged 55 or over (88%), UK homeowners (84%) and parents (82%).

Age is a contentious issue

Nearly three in four (74%) people surveyed said they feel that meeting repayment criteria should determine mortgage eligibility, not age. Moreover, three in five (60%) of those surveyed believes that everyone who can afford the repayments when they retire should be eligible for a mortgage. This view has risen up from 53% since the January poll.

Commenting on the findings, Jon Hall, Managing Director of Masthaven said: “Just as homes have kerb-appeal to buyers, it seems people have a perceived sense of their own mortgage-appeal to lenders. Our report highlights how many people believe they have low or no appeal to mortgage lenders; they have little faith in the market. Whether these homeowners’ beliefs are founded or not, the industry cannot ignore how customers feel – their perceptions need attention. I believe the industry can adapt, and we’re publishing the report to encourage lenders to look at the new face of home borrowing: ordinary people with normal lives. The UK mortgage industry must create products and processes that are fit-for-purpose for society today – a world that’s rapidly evolved and looks different to even just a few years ago.”

Time for change

Game of Loans examines four audiences segments: self-employed, older borrowers, parents, and younger borrowers. Masthaven suggests that, despite new mortgage regulations providing a more stable framework, lenders have not adapted their approaches to cope with evolving financial lives. The bank is urging lenders to look closer at individual borrowers’ lives, so they can create products and processes that are fit for modern life. For example:

Jon Hall added: “The audiences examined in our report aren’t niche groups on the fringes of society, they’re growing segments of the population with modern needs that a thriving mortgage market must address. It shouldn’t be 'game over' for many homebuyers before they’ve even put a foot on the property ladder. As a bank we need to make sure our application of the affordability rules are revisited regularly, to check hard-working householders are not being excluded from the mortgage market.  As a specialist lender we put people at the heart of the solution. Manual underwriting drives our decision-making rather than technology, and we work in tandem with brokers to assess customers’ individual needs.  I’m concerned to hear so many borrowers feel unsupported when in reality an experienced lender, with flexible processes and great broker partnerships, may be able to help.”

Other key findings

Alongside how difficult they felt it would be to get a mortgage, Masthaven asked people their views on other topics, including: the mortgage process, the UK housing shortage, intergenerational disparity, and lending into retirement.

Over half (55%) of self-employed respondents believes they would find it hard to get a mortgage today; and 70% of them feel that getting a mortgage is about which financial boxes you ‘tick’, not the reality of your situation.

Respondents’ perception of their ‘mortgage-appeal’ varied across the UK. Respondents in Wales have the strongest doubts - 72% believe they would find it hard to get a mortgage today, compared to 53% in Scotland. 68% of people in the East of England feel it would be hard, compared to 50% in Yorkshire & Humberside.

While many (73%) respondents have never used a mortgage broker or adviser, over a quarter (27%) have. Among the latter group, almost one in five (19%) said it was because their circumstances were “complicated”.

Three in four (75%) respondents believes it is unfair the young are struggling to get onto the housing ladder today. This view rises to 78% among people aged 55 or over. It drops to 72% among men, but rises to 78% among women.

Many people surveyed believe the UK housing gap will grow:  61% predict the shortage of affordable homes will increase in the next five years; this rises to 64% among people aged 55+ and is felt strongest (68%) in Scotland.

Nearly three in five (58%) respondents believes the price difference between homes in the north and south of the UK will increase in the next five years, but views vary - ranging from 79% in Newcastle to 44% in Cardiff.

More than two in three (67%) people polled thinks UK interest rates will increase in the next five years; meanwhile almost a third (32%) believes the average wage of homeowners will decrease in the next five years.

(Source: Masthaven Bank)

Despite its significant economic growth and vast oil riches, Nigeria has struggled to fight poverty in the past three decades. Finance Monthly had the privilege to speak to Godwin Ehigiamusoe, a man who’s devoted his career to helping the poor and the vulnerable people of Nigeria.


LAPO (Lift Above Poverty Organization) is a non-profit community development organization committed to the social, health and economic empowerment of the poor and vulnerable. Please tell us about the company’s beginnings.

Lift Above Poverty Organization (LAPO) was initiated to address the challenges that the poor and the vulnerable are facing. I established the company in Ogwashi-Uku, Delta State in late 1980s in response to the increasing level of poverty arising from the implementation of the central components of the Structural Adjustment Programme (SAP). These components of SAP were the first devaluation of the national currency - the Naira; and rationalization of workforce in the public sector. The impact of programme implementation on poverty was enormous. For example, the number of Nigerians living below the poverty line rose from 18 million in 1980 to 67 million in 1996[1].

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In mid-2010, we established LAPO Microfinance Bank- a premium Microfinance Bank. LAPO has also capitalized LAPO Microfinance Company in Sierra-Leone. The bank’s superior performance has been powered by flexible institutional structures and processes which effectively engage members of low-income households; owners of micro and small enterprises.


What are LAPO Microfinance Bank’s key priorities towards its clients? How has this evolved over the years?

LAPO Microfinance Bank prioritizes access to a range of responsive financial services particularly, micro loans. It has also committed enormous investments in client support activities and clean energy lending. LAPO Microfinance Bank provides basic micro-business management services to clients who are owners of micro and small scale enterprise. It facilitates access to insurance policies for poor clients. Its credit plus approach to service delivery is informed by the fact that low income people, particularly women contend with challenges beside lack of access to finance. Over the years, LAPO has expanded its loan portfolio from few products to a basket of responsive products. They range from farming to affordable housing and education loans.


How have the LAPO Microfinance Bank’s service offerings evolved?

Like most microfinance institutions, LAPO at inception started with mono-product which was a working capital loan for micro and small businesses. In its 5-year plan (2013-2017), LAPO Microfinance Bank prioritised product diversification. As a result, a number of credit and deposit products have been developed and offered to meet the varied financial needs of low-income people, micro and small businesses. LAPO Microfinance Bank is currently deploying alternative financial delivery channels to expand its outreach.


As CEO, how do you advise your team to make the correct decisions for the company alongside clients?

I emphasize client engagement which consists of regular interaction and assessment of their current and emerging needs. Other steps include efficient service delivery and effective performance management. I also prioritize innovations with the creation of Innovation Lab. Staff members are empowered with various training and capacity development programmes. They are encouraged and indeed involved in goal setting and a periodic performance review.


What are your plans for the company for the rest of 2017 and beyond?

LAPO Microfinance Bank shall seek to extend its range of services to actors in the rural economy. This is understandable; Microfinance should be made relevant to agriculture in Africa, given the fact that a large number of Africans engage in agriculture and allied activities. A range of products will be offered to meet the financial needs of the various segments in the agriculture value chain. We plan to deepen our cleaning energy lending in the coming years.


Your job must be very rewarding. Is this the motivation that drives you?

 Indeed – the past three decades of engagement with poverty lending have been full of excitement. There is certainly a sense of fulfillment.

I am driven largely by the desire to address the scourge of poverty. This informed my decision to set up the organization in the first place, and has continued to propel my desire to scale up to reach a large number of low-income people and offer them a range of empowering products and services.



[1] In Poverty and Microfinance in Nigeria (2000) by Godwin Ehigiamusoe

Kicking off July’s Game Changers section is an interview with David Taylor, the Founder, President and CEO of VersaBank. Here he tells us all about the exciting journey that building Canada’s first virtual, branchless bank has been thus far.


You founded VersaBank in 1993 – could you tell us a bit about this 24-year journey and what it has taught you?

 It certainly has been an exciting journey, filled with challenges and lessons. I thought that by applying emerging digital technology to banking, I could create a bank without branches with low overheads that could economically serve small niche markets that were not well-served by Canada’s large full-service banks. Considering this ‘branchless model’ didn’t exist at the time, I expected that I would have to educate regulators, the banking industry, customers and partners about how it would work and what the benefits would be.

I think the most discouraging lesson I learned was that banking regulators like the status quo and do not welcome new ideas, even if it means that some Canadians in niche markets would continue to suffer with only limited access to economical banking.

On converse, I think one of the most encouraging lessons I learned was that some large Canadian full-service banks recognized the important role that VersaBank could play in serving niche markets, which are perhaps too small or obscure for them, and have aided VersaBank in fulfilling its mission to serve these markets.

Developing and improving the software and systems to deliver ideally suited products to our niche markets is always an ongoing challenge, but as Terence Mann said in ‘Field of Dreams’, “If you build it he will come”. I found to my great satisfaction that if you truly endeavor to deliver ideally suited products, you will never have to look for customers. They will ‘come’.

Our niche markets are diverse and include: financing hospitals and schools in the remote Canadian arctic, developing customized web-based banking packages for the insolvency industry, providing back-end funding for the Fintech industry and point-of-sale financiers so that people can lease their hot water heaters, have cosmetic surgery, or lease equipment for their retail or business operations.

In many respects, we are the original FinTech, continuing to leverage the power of new technologies to reach our customers and serve their needs, but unlike the FinTechs of today, we’re also a Schedule 1 chartered bank with access to a huge source of funds, through an expansive network of more than 120 financial advisory and brokerage firms who deliver deposits to us digitally.

Finally, we have proven that you don’t need lax credit standards to attract borrowers. Convenient access, reasonably pricing and flexible terms will attract good quality borrowers. VersaBank has had no need for a collections department and has established one of the lowest loan loss histories in the industry. My hope was that by applying new technologies to banking, we could really make a difference to our customers’ lives. I think we have been able to do this and I look forward to continuing to grow our bank and to finding more innovative ways to serve my fellow Canadians.


Could you tell us a bit about your background prior to founding VersaBank?

 I was fortunate to be provided with a solid foundation in banking by working at two leading, but very different, banks. I started my banking career at a large full service Canadian bank, the Bank of Montreal, where I discovered a passion for the business. It was a terrific opportunity to learn the basics of banking and I spent eight years there, before moving to Barclays Bank of Canada. In Canada Barclays PLC employed a niche strategy. However, when, amidst a downturn Barclays decided that the country was a non-strategic market, I saw an opportunity to create a Canadian niche bank, which ultimately led to the formation of VersaBank.


What have been your biggest achievements to date?

 A couple of things immediately come to mind, which are at opposite ends of the VersaBank journey. They being: getting the digital bank started back in 1993 and successfully completing a very complex amalgamation transaction earlier this year. Both of these achievements were ‘firsts’.

I soon discovered that the banking regulators had no appetite to grant a bank license for a brand new bank with an untested model. So I decided to acquire an existing financial institution and transform it into my new model. I looked for the smallest financial institution I could find and discovered Pacific & Western Trust in Saskatoon, Saskatchewan. I met with the owner - Bill MacNeill at a restaurant and sketched out a plan on how I could transform Pacific & Western Trust on a napkin. When he asked if I was there to buy his trust company, I surprised him by suggesting instead that he ‘buys’ me to run and transform his trust company. I had extensive experience in the industry and was a banker and he was, in fact, a miner. He agreed to my suggestion and that opened the door for me to build Canada’s first virtual, branchless bank.

I also believe that the completion of our amalgamation in January 2017 was a key accomplishment. It was the first successful merger under the Canadian Bank Act and enabled us to significantly simplify the structure of the bank, while also realizing some significant financial benefits. It was a very complex transaction that required approvals from the shareholders of VersaBank, PWC Capital, the regulators and even the Canadian Minister of Finance. We secured an overwhelming approval from shareholders of the two companies and the other required approvals. It was a great accomplishment and was vitally important to the positioning of VersaBank for the future. We’ve created a unique state-of-the-art bank that is profitably providing banking services in niche markets throughout Canada.


Could you please tell us a bit more about the merger with PWC Capital and what it means for the future of VersaBank?

 This transaction was historic in the sense that it was the first merger to be successfully completed by a Schedule 1 bank (a domestic bank that accepts deposits) under the Canadian Bank Act. Previous attempts by other banks had been unsuccessful.

While that’s a fun fact, the merger for us was critical to our future success, as it ultimately was about creating a simplified structure for VersaBank and eliminating confusion that existed with its parent company, PWC Capital. Previously, there had been two publicly traded companies, VersaBank and its parent a financial holding company, PWC Capital. This created duplication and PWC Capital had been highly leveraged. In addition, potential investors often were confused about the differences between PWC Capital and the banking entity, Pacific & Western Bank of Canada (now VersaBank). This structure was inefficient and it impeded our ability to grow. We needed to change it.

What emerged out of this complex transaction is a growing, standalone, publicly traded, high-margin, branchless chartered bank that uses its software to reach key niche markets, traditionally underserved by the big Canadian banks. We have enormous growth potential.


You’ve also recently opened a new digital facility, which provides the infrastructure for VersaBank’s branchless model and complements Canada’s FinTech industry – how did the idea about the platform come about? What is your outlook for its future?

 Right from the founding of VersaBank, we believed that we would have a significant competitive advantage by designing, developing and maintaining state-of-the-art, custom banking software that helps to address customers’ specific and unique needs, while also minimizing the required investment in physical infrastructure and human resources. We’ve tended to focus on niche markets that are traditionally underserved by Canada’s big banks.

By following this approach, for example, we’ve become the bank of choice for Canada’s national consumer insolvency firms, by creating a banking package ideally tailored specifically to the unique needs of insolvency professionals. It’s highly efficient and very economical both for us and for our clients and has become a win-win for ourselves and our customers.

We recognized that there could be tremendous synergies if we brought some of our in-house teams under one roof, which has led to the establishment of our new digital facility, the VersaBank Innovation Centre of Excellence – the modern, new home of our in-house software development division and its eCommerce division. By bringing them together, we have enabled these teams to work side-by-side to encourage collaboration to improve our existing banking solutions and create new solutions for tomorrow.

The team already is working on some innovative new solutions that likely will hit the market in the next couple of years.


Is there anything else you would like to add?

Arguably, when first conceived, VersaBank was a little ahead of the times, but the times have now caught up and VersaBank is finally able to take full advantage of its systems and model to serve people across Canada without branches. Its products are in high demand and its margins lead the industry without the usual loan losses. Twenty years ago this would have been a dream, but today, the dream has become a reality.


Collinson Group research has revealed that just 38 percent of bank and financial service customers in the UK feel rewarded for their custom. Customers are looking for more opportunities to earn loyalty currency and more choice when redeeming their points.

Reward and recognition are becoming increasingly important for customer retention and revenue growth. As regulators encourage greater competition in the financial services market, new competitors emerge and consumers are given more opportunities to compare and switch services. Brands must consider how best to remain attractive to this sophisticated set of consumers who have a greater access to information and are always after the best value for money.

The Collinson Group research with 2,250 consumers across the United States, United Kingdom, Singapore and the UAE revealed that more than three quarters of respondents (77 percent) look for loyalty programmes with a greater choice of rewards. Furthermore, four in five respondents (82 percent), said that the value of a programme decreases when there is only a limited range of rewards available.

In the UK, research respondents cited three ways that financial services loyalty programmes could be improved: the ability to combine points with cash (37 percent), have a larger selection of rewards (37 percent) and a simpler user experience (33 percent). This indicates that usability and accessibility of rewards are top of mind for financial services loyalty programme members.

Two of the strongest categories of reward that are most popular with global financial services customers are travel and leisure. In the UK, customers consistently place a high value on benefits such as airport lounge access, concierge services and unique social and cultural leisure experiences[1]. Collinson Group research reinforces that customers value products and experiences offered outside of company core inventory as part of a financial services loyalty programme.

Respondents also expressed a desire to have more redemption opportunities. In fact, 66 percent of global financial service customers said that they specifically look for a loyalty programme that has both in-store and online redemption capabilities. This capability does not currently feature in many financial services loyalty programmes, with 70 percent of UK respondents revealing that they would like the opportunity to redeem in-store. An enhanced redemption experience is delivered through a programme that offers the customer the ability to redeem in both retail outlets and leisure stores, as well as an e-commerce platform. Survey respondents were clear that the value of a loyalty programme decreases if points cannot be redeemed in physical retail outlets, with 51 percent in the country agreeing.

Christopher Evans, Director at Collinson Group said:

“Traditional financial services models continue to evolve, with a focus on improved digital services and experiences, but a key area brands need to consider is how they recognise and reward existing customers. Other sectors such as travel and retail are demonstrating new ways of offering more personalised, timely and relevant rewards.

“A key element in enabling this is providing customers with more ways to earn and redeem loyalty currency. Offering the opportunity to ‘spend’ points against non-financial products such as travel, leisure or more altruistic rewards is increasingly attractive to programme members. The chance to redeem points in physical stores such as retailers and to part-pay with loyalty points and cash all make programmes more relevant and therefore more valuable to consumers.”


[1] Collinson Group mass affluent research – rethinking the customer relationship:

Canada's economic progress has been driven by its historical preference for openness to people, capital and trade, Bank of Canada Governor Stephen S. Poloz has said.

In a speech marking both the 150th anniversary of Confederation and the 50th anniversary of Durham College, Governor Poloz looked at Canada's economic history and showed how all periods of substantial progress have been characterized by openness in these three areas. "The bottom line of our history is that openness and economic progress go hand in hand," Governor Poloz said.

While support for openness has ebbed and flowed over the years depending on circumstances, Canada's economic roots have meant that a preference for openness has tended to re-emerge, the Governor said. For example, the colonies that united at Confederation benefited from open trading with the United States before 1867. When they lost free access to the US market, Confederation became the strategy they employed to help the economy develop.

Canada's ascent also depended on people who understood the need for infrastructure to get resources to market, and how to attract the investment to finance these projects. "The people who developed what has become the world's soundest banking system were vital to Canada's development," the Governor said. Open markets, foreign investment and immigration remain absolutely critical for Canada today, Governor Poloz said.

Fears of openness are heightened during times of economic stress, the Governor added. However, experience has shown that such fears are misplaced.

"Our history shows that it takes a world to raise a nation, and nation building works best in an environment of openness for trade, people and investment," Governor Poloz said. "Our openness has helped us build a nation that I believe is the best place to live in the world. Imagine what we can build over the next 150 years."

(Source: Bank of Canada)

With news that average UK house prices surged by almost £4,000 in December, specialists from a leading Midlands law firm are questioning whether the so called ‘bank of Mum and Dad’ has started to have an effect on the property market.

“According to the Halifax, house prices rose by 1.7% in December, with the average cost of a property reaching a new high of just over £222,000,” says Neil Stockall, a Partner at Higgs & Sons and head of the Residential Property team.

“This represents the fastest acceleration in property values since the Brexit vote. According to the Office for National Statistics the number of 18-24 year olds living at home is around 3.3m.”

Neil added: “Perhaps the combination of being able to save more, plus some much needed input from parents, has helped some of these young people to take their first step on to the property ladder, thus resulting in this surge.”

Many parents want to help their grown up children in whatever way they can and it is increasingly common for first time buyers to turn to the 'Bank of Mum and Dad' for help in raising the required mortgage deposit.  Often parents use their nest eggs to provide that support – particularly with interest rates on savings being so low at the moment. However, there are several things that parents and their children should bear in mind if they want to avoid future problems.

“A common way for parents to help is to ‘advance their inheritance’ to children. This comes with dangers as, should a parent die within seven years of making such a gift, inheritance tax will be payable if the total gifts within those seven years exceed the parents’ inheritance tax allowance.

“Further, if the child is in a relationship or marriage that later breaks down, then the ‘gift’ from the parents may become part of any financial settlement, with half required to be paid to the child's ex-partner.”

Financial gifts of this nature can, however, be protected.

“It is important that when the new home is bought, the professional advisers involved in the process are made aware that the deposit has been given by a family member. The property title will be noted to reflect this, and an appropriate Declaration of Trust can be prepared.

“An alternative approach is to make any such payment by way of a loan rather than a gift and to have a suitable loan agreement drawn up which can be secured against the property. This approach would need sanctioning by any lender, so full disclosure should be made when applying for a mortgage.

“Any such loan could be interest free and the parent may not even really expect that it would actually be repaid, but in the event of a breakdown in their child’s relationship, they will at least know that that payment will fall outside any dispute.

“When it comes to the possibility of a breakdown in a child’s relationship, nuptial agreements may be extremely helpful. These are being given ever greater weight by the courts, provided they are entered into properly. Such agreements would be subject to various qualifications and it is important that expert advice is sought from a specialist in this area of family law prior to committing.”

(Source: Higgs & Sons)

DeutscheBank_Q110_Lounge_BuecherregalDeutsche Bank reaffirmed its commitment to being a leading global bank based in Germany when it announced the next phase of its strategy, covering the period through to 2020, at the end of April. The bank’s announcement covers key strategic decisions, division-specific initiatives and financial targets.

Jürgen Fitschen and Anshu Jain, Co-Chief Executive Officers, said: “This marks the next milestone in the journey we began in 2012. Deutsche Bank’s course is clear. We reaffirm our commitment to being a leading global bank based in Germany. To achieve this, we must remain client-centric, but focus more sharply on mutually attractive client relationships; remain global, but become more geographically focused; and remain universal, but avoid trying to be all things to all people.”

As a result of its strategy review process, the bank took six new decisions which support the next phase of its strategy. The bank’s objectives are to:

Corporate Banking & Securities (CB&S) aims to further de-emphasise lower-return business, increase its focus on client solutions and invest in growth in higher-return products. CB&S plans to reduce gross leverage by approximately €200 billion, while redeploying €50-70 billion to improve its position in relationship-driven businesses.

Deutsche Bank also said it plans to invest up to €1 billion additionally over the next three to five years in digitisation to capture new revenue opportunities, for example, through remote advisory channels; realise platform efficiencies through automated or digitised processes; and develop new client propositions.

Through 2020, the Bank’s objective is to refocus its global footprint, reducing the number of countries or local presences by 10-15% and actively investing in markets and urban centres which are most relevant to international and multinational clients.

Bank -shutterstock_1#D8773FBank lending conditions in emerging economies tightened abruptly to their weakest level in three years in the first quarter of 2015, according to the latest Emerging Markets Bank Lending Conditions Survey from the Institute of International Finance (IIF).

"The sharp tightening of EM bank lending conditions is further evidence that emerging market economies are struggling," said Charles Collyns, Chief Economist at the IIF. "In addition to a demand slowdown, supply conditions continued to deteriorate. Banks reported a continued tightening in funding conditions, likely reflecting the cautious tone in EM financial markets, at least until the March FOMC (Federal Open Market Committee) meeting."

The composite index of the IIF's Bank Lending Survey dropped 1.7 points to 48.1 in Q1 2015, the lowest since Q4 2011. An index reading below 50 reflects a tightening in bank lending conditions. This tightening in lending conditions was driven by a sharp decline in loan demand, whose index fell to the lowest level in the series starting Q4 2009.

The index for domestic funding conditions edged up 1.5 points to reach 50.7 in the first quarter of 2015. This was primarily driven by a substantial improvement in funding conditions in EM Asia, even as funding conditions in other regions tightened.

By region, EM Asia and Latin America drove the overall tightening in bank lending conditions. Lending conditions in EM Europe also entered tightening territory after easing in 2014. The improvement in bank lending conditions in the MENA region continued to moderate, probably reflecting the impact of weaker commodity prices since the second half of 2014.

The survey covered 130 EM banks and was conducted between March 12 and April 23, 2015.

Standard Chartered ShanghaiUK-based bank Standard Chartered announced a 22% drop in Group operating profit for the first quarter of 2015, at US$ 1.47 billion (€1.35 billion) compared with US$ 1.87 billion (€1.7 billion) for the same period in 2014.

The bank’s Interim Management Statement listed first quarter income down by 1% on a constant currency basis. Headline income of US$ 4.4 billion (€4 billion) was down 4%, 1% of which was the result of business exits.

Peter Sands, Group Chief Executive, commented: “We are on schedule to deliver a Common Equity Tier 1 ratio of between 11% and 12% and sustainable cost saves in excess of US$ 400 million (€365 million) in 2015. Trading conditions remain challenging and the actions we are taking to de-risk, cut costs and build capital are having an impact on near term performance. However, underlying business volumes generally remain strong. We remain confident in the strength of our franchise, the opportunities in our markets and in our ability to build returns to an attractive level in the medium term.”

Earlier this year, Standard Chartered announced the closure of its institutional cash equities, equity research and equity capital markets (ECM) activities, leading to 200 job losses. The decision to close its equities business formed part of its austerity measures announced in November 2014 with the aim of saving $400 million (€365 million) in 2015.

Overall, the Group remains highly liquid and well capitalised, with ratios well above current regulatory requirements. Group Risk Weighted Assets were slightly up on the year end and the bank stated it is well advanced on its plan to take out US$ 25-30 billion (€23-27 billion) in the next two years.


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