Chief City Watchdog Attacked the Building Societies' Sector

The Financial Services Authority accused building societies of mutual primary mistakes as well as of insufficient management of risks during the crunch of the credit system. Building Societies Association Conference was held in Harrogate, Hugh May and Nick Lock, the FSA manager of retail firms division, heavily criticized leading players of the building industry for inadequate financial policy. Specialist claimed that the appetite of building industry giants was too high, excessively ambitious performance purposes and risks did not price its value. The investment in risk management was completely inadequate. By the way, the Financial Services Authority has already warned building societies that such tremendous risky lending practice was not worth trying, however only a few took notes. As a result of this unreasonable policy many building companies collapsed or ended up on the edge of bankruptcy or are likely to merge with larger competitors. The Skipton saved the Scarborough, the Yorkshire saved Barnsley, and Nationwide absorbed the Derbyshire, Cheshire and Dunfermline. The Chelsea merged the Catholic. Further merges are awaited in the next months. Within further 18 months the development of the sector is difficult to predict no one can guarantee that what happened to The Dunfermline will never happen again.