10 years since the start of the financial crisis.
Discussion
James_B said:
So said:
RBS and Yorkshire Bank allegedly (for legal reasons) deliberately causing hardship to people and businesses for their own ends.
They chose between keeping extending credit to businesses in trouble, or calling in the loans and sending the businesses to the wall.If they thought that option A would just see them lose ever more then option B was the right one to take.
Nothing illegal, immoral, or dodgy about that.
https://www.telegraph.co.uk/finance/newsbysector/b...
https://www.thisismoney.co.uk/money/markets/articl...
The pair then left RBS to go to Santander where Sullivan is in charge of small business banking
https://www.thisismoney.co.uk/money/news/article-5...
article said:
Chris Sullivan was deputy chief executive of RBS but left at the end of 2014. He was one of two RBS executives accused of being “wilfully obtuse” when giving evidence to MPs in June 2014.
An RBS department, the global restructuring group (GRG), was the focus of allegationsthat it forced viable small businesses to the brink so that the bank could buy up their properties and make a profit.
Sullivan told the Treasury select committee that the unit was not run as a profit centre, but later admitted that on an accounting basis the operation was run that way.
If you think there’s nothing immoral about that then fair enough. An RBS department, the global restructuring group (GRG), was the focus of allegationsthat it forced viable small businesses to the brink so that the bank could buy up their properties and make a profit.
Sullivan told the Treasury select committee that the unit was not run as a profit centre, but later admitted that on an accounting basis the operation was run that way.
Despite wages being pretty much stagnant in the 10 years since the GFC house prices have, for the most part, fully recovered if not exceeded the levels previously attained through huge scale fraudulent and irresponsible lending and borrowing...
This time thanks to huge scale intervention and support from the govt and BoE as well as ever lengthening borrowing periods allowing people to become pretty much lifelong mortgage slaves.
This time thanks to huge scale intervention and support from the govt and BoE as well as ever lengthening borrowing periods allowing people to become pretty much lifelong mortgage slaves.
JagLover said:
The Guardian article is accurate enough in terms of the challenges facing the UK economy and the west more generally.
Those wanting to blame the banks, and a specific financial crises, should reflect on the fact it has been ten years now and the banks have recovered, debt has shot up again, house prices are higher than the 2008 highs in virtually all of the western major cities.
You need to separate the short term and the long term, and also separate the symptoms from the causes.
There was a specific issue in the America sub prime mortgage market in the late 1990s early 2000s, government helped create it in the push to expand home ownership and greed did the rest. The securitisation of the mortgages then put the whole financial system at risk. There was a specific crises that was in part created by the economic fundamentals moving out of alignment.
We are now supposed to believe that growth ten years afterwards is still depressed by this one crises?. Just to put this in perspective a few years after the 1990s recession the UK economy was growing strongly.
Unless we confront where we are going wrong we will likely have another decade of stagnation and articles saying "twenty years since the crash", with a pretence that this stagnation is still due to that long ago event.
I disagree with elements of the article especially with rising fuel duty, if anything a little controversial but I would lower taxes in the hope of encouraging more spending, VAT, fuel duty etc Those wanting to blame the banks, and a specific financial crises, should reflect on the fact it has been ten years now and the banks have recovered, debt has shot up again, house prices are higher than the 2008 highs in virtually all of the western major cities.
You need to separate the short term and the long term, and also separate the symptoms from the causes.
There was a specific issue in the America sub prime mortgage market in the late 1990s early 2000s, government helped create it in the push to expand home ownership and greed did the rest. The securitisation of the mortgages then put the whole financial system at risk. There was a specific crises that was in part created by the economic fundamentals moving out of alignment.
We are now supposed to believe that growth ten years afterwards is still depressed by this one crises?. Just to put this in perspective a few years after the 1990s recession the UK economy was growing strongly.
Unless we confront where we are going wrong we will likely have another decade of stagnation and articles saying "twenty years since the crash", with a pretence that this stagnation is still due to that long ago event.
James_B said:
So said:
RBS and Yorkshire Bank allegedly (for legal reasons) deliberately causing hardship to people and businesses for their own ends.
They chose between keeping extending credit to businesses in trouble, or calling in the loans and sending the businesses to the wall.If they thought that option A would just see them lose ever more then option B was the right one to take.
Nothing illegal, immoral, or dodgy about that.
We had a seven figure sum in commercial finance with one of those banks, which was well within covenants and with about 1/3 of its term left to run.
The bank wanted its money back, because it was pulling out the sector.
So what they did was try to force us to get the assets revalued, using a valuer who they knew would low-ball. From there they intended to issue a margin call which they thought we couldn't meet and force the sale of the assets. We knew this was what they were up to because we watched them doing it to other businesses.
The bank manager dealing with it would engage in lots of low-level tactics to try to cause us stress. For example, emailing demands on a Friday afternoon when he knew full well I was away for two weeks from that evening and couldn't respond properly.
We got involved with several big legal firms, who were acting for much larger players than us. It was no secret what the bank was up to. But the bank was very skilful at dressing it up as acting properly, within its rights and in a benign manner.
We held out and didn't allow the bank to intimidate us, though it made me personally quite ill for a while. Our MP - a senior Conservative - intervened and basically threatened the bank, which made them back down.
We paid back the debt on the day it was due.
Rovinghawk said:
V8 Fettler said:
Insufficient investment in SME is one area where the UK is failing.
Not just lack of investment- there seems to be an actively punitive regime in place. I give you ever-increasing rules & regulations, increasing taxes and MTD as examples.So said:
No it went far further than that.
We had a seven figure sum in commercial finance with one of those banks, which was well within covenants and with about 1/3 of its term left to run.
The bank wanted its money back, because it was pulling out the sector.
So what they did was try to force us to get the assets revalued, using a valuer who they knew would low-ball. From there they intended to issue a margin call which they thought we couldn't meet and force the sale of the assets. We knew this was what they were up to because we watched them doing it to other businesses.
The bank manager dealing with it would engage in lots of low-level tactics to try to cause us stress. For example, emailing demands on a Friday afternoon when he knew full well I was away for two weeks from that evening and couldn't respond properly.
We got involved with several big legal firms, who were acting for much larger players than us. It was no secret what the bank was up to. But the bank was very skilful at dressing it up as acting properly, within its rights and in a benign manner.
We held out and didn't allow the bank to intimidate us, though it made me personally quite ill for a while. Our MP - a senior Conservative - intervened and basically threatened the bank, which made them back down.
We paid back the debt on the day it was due.
I am very sorry you had a tough time in the recession, and I am glad it all worked out for you.We had a seven figure sum in commercial finance with one of those banks, which was well within covenants and with about 1/3 of its term left to run.
The bank wanted its money back, because it was pulling out the sector.
So what they did was try to force us to get the assets revalued, using a valuer who they knew would low-ball. From there they intended to issue a margin call which they thought we couldn't meet and force the sale of the assets. We knew this was what they were up to because we watched them doing it to other businesses.
The bank manager dealing with it would engage in lots of low-level tactics to try to cause us stress. For example, emailing demands on a Friday afternoon when he knew full well I was away for two weeks from that evening and couldn't respond properly.
We got involved with several big legal firms, who were acting for much larger players than us. It was no secret what the bank was up to. But the bank was very skilful at dressing it up as acting properly, within its rights and in a benign manner.
We held out and didn't allow the bank to intimidate us, though it made me personally quite ill for a while. Our MP - a senior Conservative - intervened and basically threatened the bank, which made them back down.
We paid back the debt on the day it was due.
Looking from your end of the telescope, I have no doubt that you saw what you saw, however it is equally true that the banker looking from the other end would validly see something different.
You saw a low ball valuation to seize your assets. They saw a 50% fall in commercial property values which meant their security was alot worse than when they underwrote the deal.
What I can say is that if you raised your concerns with the RICS about what you consider to be a low ball valuation, it would be looked at very seriously and that the Banks exercise no extraordinary power within that professional organisation.
No doubt all those on miniscule LTVs and white Audis on PCP will be preparing for the worst now that we seem to be at the end of a bubble - even your mate Gordon [not Gecko] has sounded off. No of course not, let's just blame some men in suits when/if the credit bubble bath has its plug pulled.
So said:
No it went far further than that.
We had a seven figure sum in commercial finance with one of those banks, which was well within covenants and with about 1/3 of its term left to run.
The bank wanted its money back, because it was pulling out the sector.
So what they did was try to force us to get the assets revalued, using a valuer who they knew would low-ball. From there they intended to issue a margin call which they thought we couldn't meet and force the sale of the assets. We knew this was what they were up to because we watched them doing it to other businesses.
The bank manager dealing with it would engage in lots of low-level tactics to try to cause us stress. For example, emailing demands on a Friday afternoon when he knew full well I was away for two weeks from that evening and couldn't respond properly.
We got involved with several big legal firms, who were acting for much larger players than us. It was no secret what the bank was up to. But the bank was very skilful at dressing it up as acting properly, within its rights and in a benign manner.
We held out and didn't allow the bank to intimidate us, though it made me personally quite ill for a while. Our MP - a senior Conservative - intervened and basically threatened the bank, which made them back down.
We paid back the debt on the day it was due.
Sounds fairly normal . We had a seven figure sum in commercial finance with one of those banks, which was well within covenants and with about 1/3 of its term left to run.
The bank wanted its money back, because it was pulling out the sector.
So what they did was try to force us to get the assets revalued, using a valuer who they knew would low-ball. From there they intended to issue a margin call which they thought we couldn't meet and force the sale of the assets. We knew this was what they were up to because we watched them doing it to other businesses.
The bank manager dealing with it would engage in lots of low-level tactics to try to cause us stress. For example, emailing demands on a Friday afternoon when he knew full well I was away for two weeks from that evening and couldn't respond properly.
We got involved with several big legal firms, who were acting for much larger players than us. It was no secret what the bank was up to. But the bank was very skilful at dressing it up as acting properly, within its rights and in a benign manner.
We held out and didn't allow the bank to intimidate us, though it made me personally quite ill for a while. Our MP - a senior Conservative - intervened and basically threatened the bank, which made them back down.
We paid back the debt on the day it was due.
Lot of naive views on here about how banks operate in a straight forward and transparent way and deal fairly with customers and within the letter and spirit of the law.... and are partners to business
( .... have previously worked in a major UK bank for a few years )
loafer123 said:
So said:
No it went far further than that.
We had a seven figure sum in commercial finance with one of those banks, which was well within covenants and with about 1/3 of its term left to run.
The bank wanted its money back, because it was pulling out the sector.
So what they did was try to force us to get the assets revalued, using a valuer who they knew would low-ball. From there they intended to issue a margin call which they thought we couldn't meet and force the sale of the assets. We knew this was what they were up to because we watched them doing it to other businesses.
The bank manager dealing with it would engage in lots of low-level tactics to try to cause us stress. For example, emailing demands on a Friday afternoon when he knew full well I was away for two weeks from that evening and couldn't respond properly.
We got involved with several big legal firms, who were acting for much larger players than us. It was no secret what the bank was up to. But the bank was very skilful at dressing it up as acting properly, within its rights and in a benign manner.
We held out and didn't allow the bank to intimidate us, though it made me personally quite ill for a while. Our MP - a senior Conservative - intervened and basically threatened the bank, which made them back down.
We paid back the debt on the day it was due.
I am very sorry you had a tough time in the recession, and I am glad it all worked out for you.We had a seven figure sum in commercial finance with one of those banks, which was well within covenants and with about 1/3 of its term left to run.
The bank wanted its money back, because it was pulling out the sector.
So what they did was try to force us to get the assets revalued, using a valuer who they knew would low-ball. From there they intended to issue a margin call which they thought we couldn't meet and force the sale of the assets. We knew this was what they were up to because we watched them doing it to other businesses.
The bank manager dealing with it would engage in lots of low-level tactics to try to cause us stress. For example, emailing demands on a Friday afternoon when he knew full well I was away for two weeks from that evening and couldn't respond properly.
We got involved with several big legal firms, who were acting for much larger players than us. It was no secret what the bank was up to. But the bank was very skilful at dressing it up as acting properly, within its rights and in a benign manner.
We held out and didn't allow the bank to intimidate us, though it made me personally quite ill for a while. Our MP - a senior Conservative - intervened and basically threatened the bank, which made them back down.
We paid back the debt on the day it was due.
Looking from your end of the telescope, I have no doubt that you saw what you saw, however it is equally true that the banker looking from the other end would validly see something different.
You saw a low ball valuation to seize your assets. They saw a 50% fall in commercial property values which meant their security was alot worse than when they underwrote the deal.
What I can say is that if you raised your concerns with the RICS about what you consider to be a low ball valuation, it would be looked at very seriously and that the Banks exercise no extraordinary power within that professional organisation.
The re-valuations were a construct to try to force a margin call. The assets were worth the same or more than when they had previously been valued. We know that because we had very recently had some identical ones valued. The bank knew it too.
It was in part that we could demonstrate what was going on, I believe, that persuaded our MP to become as involved as he did.
So said:
I am reluctant to go into too much detail, but seriously you don't know what you're talking about.
The re-valuations were a construct to try to force a margin call. The assets were worth the same or more than when they had previously been valued. We know that because we had very recently had some identical ones valued. The bank knew it too.
It was in part that we could demonstrate what was going on, I believe, that persuaded our MP to become as involved as he did.
I clearly can't comment on your individual circumstances. The re-valuations were a construct to try to force a margin call. The assets were worth the same or more than when they had previously been valued. We know that because we had very recently had some identical ones valued. The bank knew it too.
It was in part that we could demonstrate what was going on, I believe, that persuaded our MP to become as involved as he did.
As a market, the UK Commercial Property index peaked at 220 and bottomed out at 140, so, as you say, there must have been some exceptional circumstances in your case.
loafer123 said:
So said:
I am reluctant to go into too much detail, but seriously you don't know what you're talking about.
The re-valuations were a construct to try to force a margin call. The assets were worth the same or more than when they had previously been valued. We know that because we had very recently had some identical ones valued. The bank knew it too.
It was in part that we could demonstrate what was going on, I believe, that persuaded our MP to become as involved as he did.
I clearly can't comment on your individual circumstances. The re-valuations were a construct to try to force a margin call. The assets were worth the same or more than when they had previously been valued. We know that because we had very recently had some identical ones valued. The bank knew it too.
It was in part that we could demonstrate what was going on, I believe, that persuaded our MP to become as involved as he did.
As a market, the UK Commercial Property index peaked at 220 and bottomed out at 140, so, as you say, there must have been some exceptional circumstances in your case.
So said:
loafer123 said:
So said:
I am reluctant to go into too much detail, but seriously you don't know what you're talking about.
The re-valuations were a construct to try to force a margin call. The assets were worth the same or more than when they had previously been valued. We know that because we had very recently had some identical ones valued. The bank knew it too.
It was in part that we could demonstrate what was going on, I believe, that persuaded our MP to become as involved as he did.
I clearly can't comment on your individual circumstances. The re-valuations were a construct to try to force a margin call. The assets were worth the same or more than when they had previously been valued. We know that because we had very recently had some identical ones valued. The bank knew it too.
It was in part that we could demonstrate what was going on, I believe, that persuaded our MP to become as involved as he did.
As a market, the UK Commercial Property index peaked at 220 and bottomed out at 140, so, as you say, there must have been some exceptional circumstances in your case.
Given you are saying (I think) that the assets weren't commercial property, the index isn't relevant.
So said:
No it went far further than that.
We had a seven figure sum in commercial finance with one of those banks, which was well within covenants and with about 1/3 of its term left to run.
The bank wanted its money back, because it was pulling out the sector.
So what they did was try to force us to get the assets revalued, using a valuer who they knew would low-ball. From there they intended to issue a margin call which they thought we couldn't meet and force the sale of the assets. We knew this was what they were up to because we watched them doing it to other businesses.
The bank manager dealing with it would engage in lots of low-level tactics to try to cause us stress. For example, emailing demands on a Friday afternoon when he knew full well I was away for two weeks from that evening and couldn't respond properly.
We got involved with several big legal firms, who were acting for much larger players than us. It was no secret what the bank was up to. But the bank was very skilful at dressing it up as acting properly, within its rights and in a benign manner.
We held out and didn't allow the bank to intimidate us, though it made me personally quite ill for a while. Our MP - a senior Conservative - intervened and basically threatened the bank, which made them back down.
We paid back the debt on the day it was due.
considering how well documented some of these cases are now, it amazes me that not only are some of the scumbags that did this still working in the sector but none faced criminal charges. We had a seven figure sum in commercial finance with one of those banks, which was well within covenants and with about 1/3 of its term left to run.
The bank wanted its money back, because it was pulling out the sector.
So what they did was try to force us to get the assets revalued, using a valuer who they knew would low-ball. From there they intended to issue a margin call which they thought we couldn't meet and force the sale of the assets. We knew this was what they were up to because we watched them doing it to other businesses.
The bank manager dealing with it would engage in lots of low-level tactics to try to cause us stress. For example, emailing demands on a Friday afternoon when he knew full well I was away for two weeks from that evening and couldn't respond properly.
We got involved with several big legal firms, who were acting for much larger players than us. It was no secret what the bank was up to. But the bank was very skilful at dressing it up as acting properly, within its rights and in a benign manner.
We held out and didn't allow the bank to intimidate us, though it made me personally quite ill for a while. Our MP - a senior Conservative - intervened and basically threatened the bank, which made them back down.
We paid back the debt on the day it was due.
fesuvious said:
Those constantly wishing to 'blame the banks' need to remember that for every willing lender there was a willing borrower.
In 2003 I was working with a 23yr old who was maxing his earnings at @£14k. On this he had @£30-35k on credit cards, a brand new Renault Clio on finance and wore nothing but armani / boss etc etc.
We watched as heaps of Brits remortgaged their homes here and spanked the cash on property abroad.
We watched as people eagerly mopped up 100% / 110% mortages.
We watched as Estate Agents valued properties ever higher, setting new precedents for each area with every sale.
We watched as firms like Egg offered 50year mortgages.
In 2006 I remember a mum telling me that on her sons 18th B'day he had 'at least' 5 credit card mailing shots arrive through the letterbox.
Why are we not blaming the de-regulation that allowed all this? And those that chose to do it?
Why are we not rightly apportioning blame to all those for whom greed and the desire to wear fancy clothes or buy a posh pad, or drive funky cars on lease over-rode common sense?
Yes, banks sold iffy products, and they sold people products that those people could barely afford, but every single time it was the borrower who asked for it. They were not forced.
I'm thoroughly fed up with this pious bulls
t about the evil banks.
And, no, I'm not a banker, nor am I in finance.
Good post.In 2003 I was working with a 23yr old who was maxing his earnings at @£14k. On this he had @£30-35k on credit cards, a brand new Renault Clio on finance and wore nothing but armani / boss etc etc.
We watched as heaps of Brits remortgaged their homes here and spanked the cash on property abroad.
We watched as people eagerly mopped up 100% / 110% mortages.
We watched as Estate Agents valued properties ever higher, setting new precedents for each area with every sale.
We watched as firms like Egg offered 50year mortgages.
In 2006 I remember a mum telling me that on her sons 18th B'day he had 'at least' 5 credit card mailing shots arrive through the letterbox.
Why are we not blaming the de-regulation that allowed all this? And those that chose to do it?
Why are we not rightly apportioning blame to all those for whom greed and the desire to wear fancy clothes or buy a posh pad, or drive funky cars on lease over-rode common sense?
Yes, banks sold iffy products, and they sold people products that those people could barely afford, but every single time it was the borrower who asked for it. They were not forced.
I'm thoroughly fed up with this pious bulls
t about the evil banks.And, no, I'm not a banker, nor am I in finance.
Always find it amusing those borrowers who willingly took on more debt against their property (self certification mortgages anyone? 110%loans? ) which 'could only keep increasing in value' but then when the inevitable down valuing came throwing them into negative equity as the market weakened these same people were the ones who took no responsibility whatsoever for their reckless borrowing and solely blamed the lenders.
But then we have increasingly become a nation who won't take responsibility for their own actions haven't we?
If borrowers are happy lapping up the juicy profits from property rises in the good times they should equally take any losses on the chin during hard times too but oh no its the lenders fault.
Just a point regarding the unfortunate case of the bank appointing a valuer who apparently 'low balled' to force a sale of property. A valuer acting for a bank/institution has strict professional guidelines to adhere to and has to be able justify the valuation in extreme detail maybe in court at a future date.
Panel valuers acting on behalf of intitutions are carefully vetted not selected at random and it has always been the case and is perfectly normal to have a wide variation in opinion on property value between one valuer and another.
El stovey said:
If you think there’s nothing immoral about that then fair enough.
It’s about the same level of immorality as selling someone a £30 paint protection for £500, or having a mate clock back in for you when you have a long lunch.About the same as moving LIBOR up by 1/100 of 1% when it favoured your book, or a supermarket selling the family pack at more per kg than the smaller ones, relying on people assuming bigger means cheaper.
It’s not how I’d ever choose to do things, but let’s not pretend it’s like nurses choosing to kill difficult pensioners with morphine or police fitting someone up for a serious crime.
So said:
No it went far further than that.
We had a seven figure sum in commercial finance with one of those banks, which was well within covenants and with about 1/3 of its term left to run.
The bank wanted its money back, because it was pulling out the sector.
So what they did was try to force us to get the assets revalued, using a valuer who they knew would low-ball. From there they intended to issue a margin call which they thought we couldn't meet and force the sale of the assets. We knew this was what they were up to because we watched them doing it to other businesses.
The bank manager dealing with it would engage in lots of low-level tactics to try to cause us stress. For example, emailing demands on a Friday afternoon when he knew full well I was away for two weeks from that evening and couldn't respond properly.
We got involved with several big legal firms, who were acting for much larger players than us. It was no secret what the bank was up to. But the bank was very skilful at dressing it up as acting properly, within its rights and in a benign manner.
We held out and didn't allow the bank to intimidate us, though it made me personally quite ill for a while. Our MP - a senior Conservative - intervened and basically threatened the bank, which made them back down.
We paid back the debt on the day it was due.
I’m sorry that it made you ill, but what you viewed as low-ball could absolutely have been seen to just be on the conservative side of fair to the firm who’d lent you the money.We had a seven figure sum in commercial finance with one of those banks, which was well within covenants and with about 1/3 of its term left to run.
The bank wanted its money back, because it was pulling out the sector.
So what they did was try to force us to get the assets revalued, using a valuer who they knew would low-ball. From there they intended to issue a margin call which they thought we couldn't meet and force the sale of the assets. We knew this was what they were up to because we watched them doing it to other businesses.
The bank manager dealing with it would engage in lots of low-level tactics to try to cause us stress. For example, emailing demands on a Friday afternoon when he knew full well I was away for two weeks from that evening and couldn't respond properly.
We got involved with several big legal firms, who were acting for much larger players than us. It was no secret what the bank was up to. But the bank was very skilful at dressing it up as acting properly, within its rights and in a benign manner.
We held out and didn't allow the bank to intimidate us, though it made me personally quite ill for a while. Our MP - a senior Conservative - intervened and basically threatened the bank, which made them back down.
We paid back the debt on the day it was due.
RBS remember lost fifty billion pounds through bad debts to individuals and businesses. They were being destroyed by customers welching on the deals that they signed and were trying to staunch the flow. I understand that you would like everything valued at the high end but the bank probably wanted it valued at the level that they could sell it at auction.
I understand that with the sparse facts given it’s not possible to know which view is more valid, but there is nothing wrong with a bank pushing the terms of a deal to the limit that they allow to protect themselves.
James_B said:
I’m sorry that it made you ill, but what you viewed as low-ball could absolutely have been seen to just be on the conservative side of fair to the firm who’d lent you the money.
RBS remember lost fifty billion pounds through bad debts to individuals and businesses. They were being destroyed by customers welching on the deals that they signed and were trying to staunch the flow. I understand that you would like everything valued at the high end but the bank probably wanted it valued at the level that they could sell it at auction.
I understand that with the sparse facts given it’s not possible to know which view is more valid, but there is nothing wrong with a bank pushing the terms of a deal to the limit that they allow to protect themselves.
The bank had no reason to believe that we were going to fold and cost them money. They just wanted their money back from as many borrowers in our sector as possible because it suited their strategic objectives. They weren't fussy about how they went about it.RBS remember lost fifty billion pounds through bad debts to individuals and businesses. They were being destroyed by customers welching on the deals that they signed and were trying to staunch the flow. I understand that you would like everything valued at the high end but the bank probably wanted it valued at the level that they could sell it at auction.
I understand that with the sparse facts given it’s not possible to know which view is more valid, but there is nothing wrong with a bank pushing the terms of a deal to the limit that they allow to protect themselves.
Their MO was to force businesses to have their assets valued by a completely inappropriate valuer, and not allow them to use someone more appropriate. It was a bit like insisting that you pay Sotherby's to value your 2008 Ford Escort. A big bill and the probability of an inappropriate valuation. To extend the analogy, the law firms we were in contact with had seen pretty much everyone sent to Sotheby's and everyone low-balled.We did offer to allow a "Ford dealership" to value, but the bank said no. It was at that point we decided to fight them.
Incidentally, we re-financed with a bank who employed a number of staff who we'd previously dealt with at the bank who was trying to screw us. They had been sacked some time before. They knew what was going on and were basically cherry picking the businesses that were being offloaded. Funnily enough their own valuers concurred with our book valuation.
Edited by So on Monday 17th September 17:18
So said:
The bank had no reason to believe that we were going to fold and cost them money. They just wanted their money back from as many borrowers in our sector as possible because it suited their strategic objectives. They weren't fussy about how they went about it.
Their MO was to force businesses to have their assets valued by a completely inappropriate valuer, and not allow them to use someone more appropriate. It was a bit like insisting that you pay Sotherby's to value your 2008 Ford Escort. A big bill and the probability of an inappropriate valuation. To extend the analogy, the law firms we were in contact with had seen pretty much everyone sent to Sotheby's and everyone low-balled.
The panels for banks are very small - they have to have substantial PI insurance and the ability to value all sectors around the country, and very few firms qualify. Their MO was to force businesses to have their assets valued by a completely inappropriate valuer, and not allow them to use someone more appropriate. It was a bit like insisting that you pay Sotherby's to value your 2008 Ford Escort. A big bill and the probability of an inappropriate valuation. To extend the analogy, the law firms we were in contact with had seen pretty much everyone sent to Sotheby's and everyone low-balled.
To continue your analogy, you should certainly have had BCA valuing your Ford Escort rather than Sothebys, but your local motor dealer would not have been appropriate.
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