The total value of all UK ordinary shares quoted on the London Stock Exchange increased by £619.7bn to £1777.5bn, or 53.4%. The indicators have been rising since the 1980s but since 1995 they have risen more sharply reflecting global events and it can be seen, for example, in the FTSE 100 index.
Individuals hold 11.5% of the shares, banks 2.5%, unit trusts 6.7%, insurance companies share holding has continued to fall from 21.6% in 1998 to 8.6% in 2010, pension funds holding has fallen from 21.7% in 1998 to 5.1% in 2010, investment trusts 2.1% and other financial institutions increased their hold to 16%. Private non-financial companies hold 2.3%. The rest of the world holds 41.2% of the shares. Charities, church and others hold 0.9%. The public sector increased its hold from 0.1% in 1998 to 3.1% in 2010.
FTSE 100 companies comprised 81.7% of the total value of the stock market at the end of 2010. The rest of the world holdings of shares geographical breakdown shows North America owns 56%, Europe 28% and Asia 11%.
Showing posts with label banks. Show all posts
Showing posts with label banks. Show all posts
Friday, 9 March 2012
Friday, 28 October 2011
Fall In Successful Loan Applications
There has been a decline in the percentage of success rates of businesses applying for loans from banks. In 2007 90% of loan applications to banks were successful but in 2010 there was a fall to 65% of successful loan applications. The percentage of SMEs looking for finance increased from 35% in 2007 to 42% in 2010. A majority of three quarters of businesses went to banks when looking for loans and five out of six businesses expect to apply to banks when looking for loans in future.
The main reason for refusal of loan finance was given as a lack of collateral or a lack of own capital. Poor credit rating became the most notable reason among other lenders in 2010 whereas in 2007 reasons were more sparse. In the few cases where the failure to get finance was becuase of a refusal on the part of the applicant high interest rates were less of a problem in 2010 than in 2007. This is partly due to the fact that in 2007 the Bank of England base rate was over 5% but in 2010 the base rate was held at 0.5%.
The economic outlook was given as the main limiting factor for business growth. Price competition and small margins were also among the main reasons given along with limited demand in domestic markets.
The main reason for refusal of loan finance was given as a lack of collateral or a lack of own capital. Poor credit rating became the most notable reason among other lenders in 2010 whereas in 2007 reasons were more sparse. In the few cases where the failure to get finance was becuase of a refusal on the part of the applicant high interest rates were less of a problem in 2010 than in 2007. This is partly due to the fact that in 2007 the Bank of England base rate was over 5% but in 2010 the base rate was held at 0.5%.
The economic outlook was given as the main limiting factor for business growth. Price competition and small margins were also among the main reasons given along with limited demand in domestic markets.
Friday, 29 January 2010
Overseas Share Of UK Stock Market Increased In 2008
The ONS survey of the distribution of beneficial ownership of ordinary shares in quoted companies in the UK showed that the UK stock market was valued at £1,158.4bn at the end of 2008 and that 41.5% of shares, amounting to £481.1bn, were owned by overseas investors. At the end of 2006 it weas 40%.
UK individuals owned 10.7% of ordinary shares worth £117.8bn. In 2006 it was 12.8% and when the survey began in 1963 the proportion was 54% which contrasts with the proportion owned by overseas companies at that time which was 7% and went down to 3.6% in 1981.
Insurance companies owned 13.4% worth £154.9bn, down from 14.7%. Pension funds owned 12.8% worth £148.8bn. The proportion they owned when the survey began was 6.4%. They greatly increased their percentage during the 1980s and 90s. Banks have also increased their share ownership in recent years. Their proportion increased to 3.5%, worth £40.6bn, their highest proprtion since these records began in 1963. Other financial institutions increased to 10%, worth £115.3bn, from 9.6%.
Public sector holdings have risen due to Government interventions in financial companies during the financial crisis of 2008 including the recapitalisations of RBS, Lloyds TSB and HBOS. The proportion has risen to 1.1% or from £2bn to £13bn. It had reached 3.6% in 1975.
FTSE 100 companies continue to dominate the UK stock market. Funds invested in FTSE 100 companies varied from 64.9% for individuals to 96.5% for private non-financial companies and 84.6% of investment in quoted companies was in FTSE 100 companies.
Of the 41.5% of UK ordinary shares owned by the rest of the world, 30% are owned by companies from North America, European companies owned 34% in 2008 compared to 38% in 2001, 17% by Asian companies and 15% by African companies whose percentage has increased since 2004. Australasia and Oceania now has 3% from 1% in 2004.
UK individuals owned 10.7% of ordinary shares worth £117.8bn. In 2006 it was 12.8% and when the survey began in 1963 the proportion was 54% which contrasts with the proportion owned by overseas companies at that time which was 7% and went down to 3.6% in 1981.
Insurance companies owned 13.4% worth £154.9bn, down from 14.7%. Pension funds owned 12.8% worth £148.8bn. The proportion they owned when the survey began was 6.4%. They greatly increased their percentage during the 1980s and 90s. Banks have also increased their share ownership in recent years. Their proportion increased to 3.5%, worth £40.6bn, their highest proprtion since these records began in 1963. Other financial institutions increased to 10%, worth £115.3bn, from 9.6%.
Public sector holdings have risen due to Government interventions in financial companies during the financial crisis of 2008 including the recapitalisations of RBS, Lloyds TSB and HBOS. The proportion has risen to 1.1% or from £2bn to £13bn. It had reached 3.6% in 1975.
FTSE 100 companies continue to dominate the UK stock market. Funds invested in FTSE 100 companies varied from 64.9% for individuals to 96.5% for private non-financial companies and 84.6% of investment in quoted companies was in FTSE 100 companies.
Of the 41.5% of UK ordinary shares owned by the rest of the world, 30% are owned by companies from North America, European companies owned 34% in 2008 compared to 38% in 2001, 17% by Asian companies and 15% by African companies whose percentage has increased since 2004. Australasia and Oceania now has 3% from 1% in 2004.
Friday, 8 May 2009
Bank Maintains Interest Rates At 0.5%
The Bank of England's Monetary Policy Committee decided at their meeting on 7 May 2009 that the bank rate will stay at 0.5% on commercial bank reserves. The MPC also decided to increase the size of its asset purchase programme by £50 billion to £125 billion. The world economy remains in deep recession, global output has contracted and international trade has fallen. The increase in private saving, the restructuring of balance sheets by banks and weaker global demand will continue to hold back economic activity. Another factor acting in the other direction is the stimulus given by governments around the world to improve the availability of credit by easing in monetary and fiscal policies. It was decided that as the stimulus is expected to eventually lead to a recovery in economic growth and inflation to return to the 2% target, the interest rate should remain at 0.5% and also to continue with the programme of asset purchases financed by the issuance of central bank reserves and increase its size to £125 billion.
Wednesday, 18 February 2009
Noah's Ark
The Government is steering the ship. It has instruments of control to direct the economy in a particular direction. The most important instruments include public spending and taxation decisions to alter the course of the economy. Economic indicators tell us how well a policy is working. Budgetary instruments of control are used to vary the amount of public spending to increase or depress economic activity and to target its spending to try to influence groups or areas.
Earlier administrations have denied that government could control the economy in this way. The most they could do, they said, was create the right free market conditions and competition would do the rest. Governments still do try to steer the economy. It tries to control inflation as all post-war governments have done. The recent recession and government financial support for the banks show that free markets are far from perfect and government intervention is occasionally necessary (Jones et al. 1998).
At the centre of the machine are the Treasury and the Bank of England. There is considerable argument about the extent of their power but they have an important ongoing role in daily strategy and tactics in fiscal and monetary policy (Jones et al. 1998). The Chancellor of the Exchequer has initiated several policy actions in recent months to help cope with the credit crisis, stabilize the economy, control inflation and control unemployment. Macroeconomic objectives also include long-term sustainable economic growth. The Governor of the Bank of England has also used its policy tools to carry out its functions and achieve its objectives (Parkin, Powell and Matthews, 1997).
Recessions begin when investment slows down. If investment is maintained at a modest rate, capital stock grows slowly and the law of diminishing returns works in reverse. Real business cycle theory takes changes in investment demand and demand for labour into consideration. People can decide when to work and how much but must use the real interest rate. If the quantity of money changes, aggregate demand changes. The 'dismal science' says that however much investment and technological change occurs real wage rates are always being pushed back down to subsistence levels. It is the theory on which classical population growth economics is based. The classical growth theory is likewise based on the view that population growth is determined by income levels. Modern growth theories turn the classical theory on its head.
According to the modern growth theory founded by Joseph Schumpeter new technologies are the source of economic progress. In capitalist society it creates turmoil, a process of 'creative destruction' creating new businesses and destroying currently profitable businesses. Rising incomes slow population growth because they increase the opportunity cost of having children. Growth occurs because the technological advancement and productivity growth prospects are unlimited.
Miscalculations of inflation may give an inaccurate measurement of real GDP growth. They probably give a fairly accurate estimation of the phase of the business cycle. Other indicators, such as jobs, correlate. Real GDP figures can overstate the situation because in a recession household production and leisure time are countercyclical and tend to increase. They also tend to understate to long-term growth rate. Impulses will come from future expectations of sales and profits on one hand and an increase in money supply on the other. An unanticipated change in aggregate demand due to fiscal or monetary policy may also bring a change in real GDP (Parkin, Powell and Matthews, 1997). The banks must get things moving again. Economic policy is made up in the process of execution and relies on private bodies like banks. The economy cannot work without banks circulating notes and coins, processing cheques and acting as financial intermediaries to businesses (Jones et al, 1998).
Earlier administrations have denied that government could control the economy in this way. The most they could do, they said, was create the right free market conditions and competition would do the rest. Governments still do try to steer the economy. It tries to control inflation as all post-war governments have done. The recent recession and government financial support for the banks show that free markets are far from perfect and government intervention is occasionally necessary (Jones et al. 1998).
At the centre of the machine are the Treasury and the Bank of England. There is considerable argument about the extent of their power but they have an important ongoing role in daily strategy and tactics in fiscal and monetary policy (Jones et al. 1998). The Chancellor of the Exchequer has initiated several policy actions in recent months to help cope with the credit crisis, stabilize the economy, control inflation and control unemployment. Macroeconomic objectives also include long-term sustainable economic growth. The Governor of the Bank of England has also used its policy tools to carry out its functions and achieve its objectives (Parkin, Powell and Matthews, 1997).
Recessions begin when investment slows down. If investment is maintained at a modest rate, capital stock grows slowly and the law of diminishing returns works in reverse. Real business cycle theory takes changes in investment demand and demand for labour into consideration. People can decide when to work and how much but must use the real interest rate. If the quantity of money changes, aggregate demand changes. The 'dismal science' says that however much investment and technological change occurs real wage rates are always being pushed back down to subsistence levels. It is the theory on which classical population growth economics is based. The classical growth theory is likewise based on the view that population growth is determined by income levels. Modern growth theories turn the classical theory on its head.
According to the modern growth theory founded by Joseph Schumpeter new technologies are the source of economic progress. In capitalist society it creates turmoil, a process of 'creative destruction' creating new businesses and destroying currently profitable businesses. Rising incomes slow population growth because they increase the opportunity cost of having children. Growth occurs because the technological advancement and productivity growth prospects are unlimited.
Miscalculations of inflation may give an inaccurate measurement of real GDP growth. They probably give a fairly accurate estimation of the phase of the business cycle. Other indicators, such as jobs, correlate. Real GDP figures can overstate the situation because in a recession household production and leisure time are countercyclical and tend to increase. They also tend to understate to long-term growth rate. Impulses will come from future expectations of sales and profits on one hand and an increase in money supply on the other. An unanticipated change in aggregate demand due to fiscal or monetary policy may also bring a change in real GDP (Parkin, Powell and Matthews, 1997). The banks must get things moving again. Economic policy is made up in the process of execution and relies on private bodies like banks. The economy cannot work without banks circulating notes and coins, processing cheques and acting as financial intermediaries to businesses (Jones et al, 1998).
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