I held back from commenting on the remarkable advances being consistently achieved by the chairman’s Manx Financial, MFX, now 17p. But there is no escaping the fact that it is not merely trading well it is expanding. A few days ago MFX announced that it has been licensed to take deposits within the UK. As those who have undergone the BoE’s enquiries as to suitability to take deposits will confirm this is not easy. MFX through its Conister Bank can now lend £100’s of millions at healthy rates of interest. Depositors enjoy the BoE guarantee of £85,000. The Conister Bank website sets out the interest paid on various different deposit sizes and periods.
The main advantage for Conister Bank of being able to lend more is that the cost of assessing risks in lending are recovered from a bigger debtor base thus reducing the unit cost of transactions.
There is little sign that Britain’s high street banks have any intention of competing. Even if they were to decide to rise to the challenge they would face the fundamental problem of staffing by costly dishonest dullards who are engaged in silly memos – just think of Natwest’s performance in relation to Nigel Farage.
(I have lately been in touch with Natwest on behalf of a pal and in response to Natwest’s advice that customers would get business advice remarked that I would as soon take advice from Sweeney Todd on shaving as consult Natwest.)