A recent study carried out by the Abbey National has found that over 80 percent of people in the UK are changing their lifestyles to manage the effects of the credit crunch.
Looking at rising costs of living and less access to lending consumers in the UK are spending less, selling unwanted items to raise money and some are also taking on additional work to increase their income. With considered planning and the will to stick to it most people in the UK can feel a little better about how they will be able to manage in the future say the Abbey National.
Lifestyles do not have to change drastically in order to make a big change, rather it comes down to selecting the best options when spending money. It may be choosing an alternative provider to save money or perhaps cutting back a little on non-essential spending. As the Abbey National study also highlighted increasing income is another great way of balancing the personal balance sheet.
The first half of 2008 has seen Lloyds TSB profits fall 70 percent compared with the same period last year, at GBP599 million.
The biggest cause of the reduced profit figures was a devaluation of the banks assets thanks to the global economic downturn. Taking this factor out of the equation Lloyds TSB has actually performed very well, especially in the retail banking sector. On this basis they actually increased their shareholder dividend, putting it up by 2 percent to 11.4 pence per share.
A Lloyds TSB spokesman, discussing the results, said that the bank was not directly associated with the American sub-prime market that collapsed so spectacularly and so has been quite well sheltered. The actual performance of the bank when their asset devaluations are removed has been an increase in pre tax profit of 11 percent, something that bodes very well for the future.
Representatives from Virgin Money have been discussing the potential purchase of troubled Northern Rock, they being part of a larger consortium.
The plan, if accepted, will be to make an initial GBP 11 billion payment, via commercial debt providers, and then put in a further GBP 1.3 billion for fresh capital investment. At the moment Northern Rock appear to accept the proposal put before them although there are questions over the longer term risk that taxpayers would face on the outstanding debt position.
The government will no doubt acknowledge this risk but it will be mitigated in some way by the interest rate they will earn on it, bringing extra revenue in to cover the risk, to a certain extent anyway. Right now Virgin Money look like firm favourites to take the Northern rock situation on, though only time will tell if that is the case.