Category Archives: European Union

Banking, Britain, Economic, European Union, Financial Markets, Government

Lloyd’s Banking Group: A return to profit but there are still too many unresolved issues…

UK BANKING MARKET

Lloyds reported last Wednesday a return to profit in the first half of 2013. There has been an air of quiet satisfaction both in the City and in Whitehall following the banking calamity of 2008.

The Government is now preparing for a sale of its 39 per cent stake in the lender. For the first time since 2008, the bank’s chief executive, Antonio Horta Osorio, is considering paying shareholders a dividend. Expectations of a dividend payment sent the share price up to 74p following the disclosure of the bank’s half-yearly profits.

But the market shouldn’t be so optimistic. A swathe of unresolved issues surrounds Lloyds Banking Group, not to mention the structure and impending reforms of the wider UK banking system.

Ministers in Whitehall have spoken about getting the best possible value for taxpayers from the sale of its stake in Lloyds, but suspicions remain that they will offload the bank at a price that effectively short-changes the public.

Selling above 61p will mean the national debt falling, below that price it rises. The attractiveness of a quick sale at the current market price for a Chancellor who has been embarrassed by his inability to bring down the national debt on his promised timetable should be obvious.

The price the previous government paid for its £20bn in shares was 74p a share. That amounts to being the true ‘break-even’ price, and sales below that should not be countenanced. Even at that price it is meaningless to suggest a ‘profit’ because one should only think what returns the state could have received for that £20bn investment elsewhere. The accounting is important to understand.

Then there is the matter of Lloyds’ lending to the real economy. The bank says it increased its net supply of credit to small firms by 5 per cent in the first half of the year. Financial analysts will hope that is accurate because the most recent figures from the Bank of England (which only go to March) tell a strikingly different story. They suggest Lloyds has contracted its lending to households and firms by some £6.6bn since last August, while availing itself of £3bn of cheap funding from the Bank of England.

And what about the size issue? Following the disastrous merger with HBOS in 2009, Lloyds is enormous. Lloyd’s Bank now accounts for twice as much of the loan stock to home and businesses as the next biggest bank, the Royal Bank of Scotland. The size of Lloyd’s balance sheet will fall next year when 630 branches are floated off following an EU directive, but the bank will still be excessively large. UK firms and borrowers need a broad range of credit providers, not a market dominated by a few such as RBS, Lloyds and Barclays.

Lloyds has increased its provision for the mis-selling of payment protection insurance. This is a reminder of how just egregious the bank (and other high street banks) behaved towards its customers in the boom years. Leaving this cartel untouched would risk this kind of abuse happening again.

A return to profit by Lloyd’s is good news. But we need a bank – and a wider banking system – that is able to sustainably serve the needs of the real economy.

Standard
Britain, Consumer Affairs, European Union, Government, Research, Society, Technology

Research reveals the most commonly used PIN numbers…

10 per cent of PINs can be guessed in just one attempt

Research has revealed that one in ten PINs can be correctly guessed first time. The most commonly used numbers have been revealed, with 10% of the population still using 1234.

Researchers found 17 per cent of people in Europe have suffered identity fraud. Credit card fraud cost the UK more than £388 million in 2012.

Despite a rise in credit card fraud, the most commonly-used PIN is still 1234, with 1111 and 0000 coming in second and third.

Studies have shown that one in ten codes is so obvious that it would take criminals just one attempt to guess it correctly, while more than a quarter of the codes are used so often they can be guessed in fewer than 20 attempts.

Researchers from DataGenetics, a technology consultancy, analysed 3.4 million four-digit codes and found that many people use birth years as PINs, making it even easier for hackers to guess a code simply by finding out a person’s age from online accounts.

Additional research carried out by security experts McAfee found that 17 per cent of people in Europe have been victims of credit card fraud, at a cost of £1,076 per person.

The total cost of credit card fraud in the UK last year from criminals hacking and cloning cards was £42.1 million and the total amount of fraud committed through all credit card-related crimes was £388 million.

There are 10,000 possible combinations for four-digit PIN codes using 0 to 9.

The majority of PINs in the DataGenetics list began with the number one, which may be due to the popularity of using birth years. Zero and two were also popular. The higher the number, the lower its frequency.

The majority of PINs in the DataGenetics list began with the number one, which may be due to the popularity of using birth years. Zero and two were also popular. The higher the number, the lower its frequency.

DataGenetics unlocks data held in large databases. In producing its findings it used data from previously released password tables and security breaches. By combining the password databases, researchers filtered the results to show just four-digit numbers and were able to analyse 3.4 million four-digit passwords.

They discovered that all of the possible 10,000 combinations – from 0000 to 9999 – were found in the data list.

The most popular password was 1234, but the amount of times this number occurred ‘staggered’ the researchers – almost 11 per cent of the 3.4 million passwords were 1234.

This PIN was also more popular than the 4,200 codes at the bottom of the list combined.

The next most popular 4-digit PIN was 1111, used more than 6 per cent of times.

Data Genetics compiled a list of the top 20 passwords and found that 26.83 per cent of all the passwords in the list could be guessed by attempting these 20 combinations.

The researchers said:

… Statistically, with 10,000 possible combinations, if passwords were uniformly randomly distributed, we would expect these twenty passwords to account for just 0.2 per cent of the total, not the 26.83 per cent encountered.

The more popular password selections dominate the frequency tables and the study found that 10 per cent of PINs could be guessed correctly first time.

More than 20 per cent could be guessed by using just five attempts and statistically, one third of all codes could be guessed by trying just 61 distinct combinations.

The data found that the least-used code was 8068 with just 25 appearances in 3.4 million – far fewer than random distribution would predict.

The researchers also noted that many of the high-frequency PINs could be interpreted as years because many began with 19, for example, 1984, 1967 and so on.

This could be a birth year or anniversary and if a hacker can guess someone’s age, or even obtain it through birth records or online accounts, for example, they could make an educated guess at the PIN.

The majority of PINs in the DataGenetics list began with the number one, which may be due to the popularity of using birth years.

The numbers zero and two were also popular.

The research found that the higher the number from 0-9, the lower its frequency at the start of the code.

Another study by Google Apps found that a pet’s name is the most common online password.

As many as one in six people use their pet’s name as a password.

One is six Britons admitted accessing someone else’s account by guessing the password, with partners the most common target.

TOP 10 POPULAR PINS

  1. 1234
  2. 1111
  3. 0000
  4. 1212
  5. 7777
  6. 1004
  7. 2000
  8. 4444
  9. 2222
  10. 6969
Standard
European Union, Government, Health, Medical, Research, Science

New European Laws could force drug companies to publish contentious research…

Drug companies have only ever released small amounts of their research data from clinical trials, with critics claiming that negative results are only half as likely to be published.

Drug companies have only ever released small amounts of their research data from clinical trials, with critics claiming that negative results are only half as likely to be published.

SHARING RESULTS OF CLINICAL TRIALS

Under new European laws, pharmaceutical companies could be forced to publish secret research into how drugs are created. This could potentially lead to drug companies having to disclose information about dangerous and unknown side-effects of many drugs.

The rules would mean that some of the world’s most powerful pharmaceutical companies would have to share the results of clinical trials which could then be analysed by independent scientists.

Analysts say that the move will also reveal if patients have been fooled by the use of placebos or drugs that have not been scientifically proven to work.

Drug companies have only ever released small amounts of their research data from clinical trials, with critics claiming that spurious and negative results are only half as likely to be published.

The disclosure rules being drawn up by the European Medicines Agency, an EU body, have been met with stiff resistance from pharmaceutical companies. They claim that some of their information might be misinterpreted, which might spark significant health scare’ around the use of particular drugs.

In just the last three years, 26 drug companies have racked up financial fines amounting to more than £7 billion for acting dishonestly.

GlaxoSmithKline (GSK), Britain’s largest pharmaceutical company, announced earlier this year that it would support a move for such laws by publishing the results and data of all its clinical trials.

The move and announcement by GSK followed fierce criticism of the company after it was given a £1.9 billion fine in the United States last year, in part for withholding safety data about Avandria, its best-selling and highly profitable diabetes drug.

A leaked e-mail message from the head of a leading pharmaceutical industry body to company executives revealed that ‘patient groups’ would be used in an attempt to block legislative amendments to the clinical trials directive.

The e-mail, first seen by the Guardian, a London based broadsheet newspaper, was sent by the director-general of the European Federation of Pharmaceutical Industries and Associations, Richard Bergström, to the directors and legal departments at companies including Pfizer and GlaxoSmithKline.

In his message, Mr Bergström says that patient groups will be ‘mobilised’ to express concerns about…

… the risk to public health by non-scientific re-use of data.

Campaigners have hit back and have said that the groups – which are often funded by the companies themselves – are a ‘front for the pharmaceutical industry’.

Health Action International, a campaign group, said it was ironic that such a transparency initiative being promoted by the pharmaceutical industry was now ready to use patient organisations to fight their corner. The health lobby group says that patient groups in the pay of the pharmaceutical industry will now go into battle for them, and has suggested there is a clear ‘hidden agenda’. In a statement the group said:

… Patient groups get traction because they are assumed to represent the voice of the suffering. But industry uses them to say we’re not going to get innovative medicines if the industry is deterred from investing by having to be transparent about their clinical trials.

 

Standard