Review of 2008 - Part Two

In the second part of IFAonline's review of 2008, rumours of recession and a worldwide credit crunch became fact as financial giants announced rights issues left, right and centre...

On April Fool's Day, US Federal Reserve chairman Ben Bernanke says an impending recession is no joke, but Goldman Sachs says the end of the credit crunch is nigh.

London starts to feel the brunt of the turmoil as fears up to 20,000 jobs could be lost surface, while RBS and HBOS announce the first of several rights issues by struggling financial companies.

In the IFA market, the FSA's RDR interim report announces plans to split 'sales' and 'advice', while advisers countrywide begin to feel the wrath of the credit crunch.

A Bank of England plan to revive the mortgage market is criticised.

May

Pen was finally put to paper on Pearl Group's £4.98bn acquisition of Resolution at the beginning of May, shortly before Bradford & Bingley joined the cash call brigade.

But the month was characterised by the issue of mortgage dual-pricing, with FSA chief executive Hector Sants calling it a "commercial decision" and IFAs vehemently disagreeing. An IFAonline campaign to ban the practice was favourably received by the IFA community but the FSA refused to budge.

Elsewhere, a regulator crackdown on dishonest mortgage brokers gathered pace and economists bemoaned the worst ISA season on record.

June

Lehman Brothers became the latest financial giant to announce a rights issue in June as the global credit crunch tightened its grip on world economies. UK GDP slowed to 0.2% as fears of an official recession took hold.

Elsewhere, FSA chief executive Hector Sants responded to IFAonline's dual-pricing campaign while the AMI said the practice seemed to be coming to an end.

In London, a rogue trader was deemed guilty of trying to cover up losses totalling more than $120m, while the FSA opened an investigation into 'shorting' abuse of rights issues.

Log on again tomorrow for the next part of IFAonline's 2008 review