Watchdog admits failure over Rock

The UK financial watchdog, the Financial Services Authority (FSA), has admitted that it failed to regulate Northern Rock adequately.

The FSA said there had been "a lack of adequate oversight and review" by the agency of the troubled bank.

It said too few regulators were assigned to monitor Northern Rock, which ran into trouble in August.

The FSA said it would be overhauling its procedures as a result of the weaknesses identified.

Newcastle-based Northern Rock was nationalised in February after the credit crisis forced it to seek a Bank of England lifeline to fund its mortgage loan book.

Last week it said it would cut about 2,000 jobs by 2011 and reduce its residential mortgage lending by half under plans to turn around its fortunes.

Northern Rock must also pay back Bank of England loans worth about £25bn.

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It appears that the few regulations that Parliament set on Northern Rock Bank have failed. This may cause Parliament to reform their policies on foreign companies.

Northern Rock bill gets approval

The bill to allow Northern Rock bank to be nationalised has become law after peers backed down in their demands for extra safeguards.

The Banking (Special Provisions) Bill, which cleared the Commons on Tuesday, ran into opposition in the Lords.

But MPs rejected peers' demands for an independent audit, and for the bank to come under Freedom of Information laws.

The Conservatives said it was a matter of "deep regret" that ministers had rejected the amendments "out of hand".

A third amendment requiring the Office of Fair Trading to report annually to Parliament on the impact on competition in the UK's banking market, was rejected without a vote by MPs, after ministers offered a compromise.

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This article is a prime example of how strict the U.K. is about allowing foreign companies to become naturalized within the country.

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Egg customers protest credit move

Angry customers of internet bank Egg have hit out at its decision to cancel their credit cards.

Egg says 161,000 cards belonging to people whose credit profiles have deteriorated since they signed up will stop working in 35 days time.

But people who insist they have good records have been contacting the BBC to say they are on the list.

A Labour MP is asking the banking industry watchdog, the Financial Services Association, to investigate.

Nigel Griffiths, a former deputy leader of the House of Commons, said Egg's action was "unacceptable".

A spokesman for the bank said those affected were customers it no longer wanted to lend to "regardless of their current status".

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I don't think that the Egg company should have the ability to just cancel their customer's credit cards. I wonder if parliament is going to intervene.

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Index of Economic Freedom in the U.K.

The economy of the United Kingdom (U.K.) is 79.5 percent free, according to our 2008 assessment, which makes it the world's 10th freest economy. Its overall score is 0.5 percentage point lower than last year, reflecting worsened scores in four of the 10 economic freedoms. The U.K. is ranked 3rd out of 41 countries in the European region, and its overall score is much higher than the regional average.

The U.K. scores extraordinarily well in investment freedom, trade freedom, financial freedom, property rights, business freedom, and freedom from corruption. The average tariff rate is low, despite distortionary EU agricultural tariffs, and business regulation is efficient. Almost all commercial operations are simple and transparent, and support for private enterprise is a world model. Inflation is fairly low, and the business climate attracts foreign investment. The financial sector is a world hub. The judiciary is independent and highly trained. Corruption is almost nonexistent, and the labor market is notably flexible.

The U.K. scores far below the world average in government size and fiscal freedom. Total government spending equals more than two-fifths of GDP, and tax revenue and rates are very high.

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This artcle shows the amount of freedom that the U.K.'s economy has in comparison to the rest of the world.