Teresa Hunter's Final Statement: Nadir reminds us of good old days of City scandals

Published on Friday 27 August 2010 16:34

THERE'S nothing like an old lemon to leave a sour taste in your mouth. Yet the reappearance of disgraced corporate hero Asil Nadir has cheered us all up; reminding us, as he does, of what fun City scandals used to be.

He began his career in the family fruit business in Cyprus and built a huge corporate empire that took about as much looking into as a crate of rotting bananas, or indeed a toxic bundle of mortgages.

But that didn't stop the share price soaring from a few pence to 35 in a short space of time. Small investors, who, in their time-honoured fashion, piled in at the top, lost a fortune when the company crashed.

In those days, when the game was up, jail looked inevitable so Nadir fled the country. What a shame some incriminated in recent scandals didn't share that urge to depart these shores.

He says he left because he wouldn't receive a fair trial. And he will today? When Polly Peck means nothing to most people, and very few can any longer remember what happened?

Doubtless, elderly investors who lost money on what they subsequently concluded was a fraud will be less convinced that justice will be done 17 years later.

If nothing else, Nadir reminds us of how quickly the world moves on. Since he was last in the UK, we have lived through another boom and bust.

Sooner than we think, our current malaise will be a foggy memory for most, although there is still much heavy lifting to be done before we can look back with relief.

You can't deny, though, a sense of loss for his generation of flamboyant tycoons. True, they treated corporate cash flow like a personal piggy bank and were generally unpleasant to work for, but oh... the glamour.

It's hard to believe such characters existed. Ernest Saunders, chief executive of Guinness, one of our finest companies, in jail for rigging the share price. Robert Maxwell falling off a yacht, just as the authorities were closing in on him. What drama!

It couldn't last, and the old devils gave way to an army of accountant executives. Their unique selling point was to be deadly dull. That didn't work either. They could read balance sheets and tick boxes, but lacked the imagination to look over the horizon and predict dark clouds forming.

The mind boggles as to where we'll find our next generation of business leaders. I know: why don't we let people, suitably qualified, honest and experienced, run their companies? That means bankers running banks and so on. Novel, I know, but it might just work.

Scotland sees drop in first-time buyers

IT'S MISERABLE being stuck in the office when everyone else is sunning themselves on foreign shores, which must explain the current gloomy prognosis. If you believe most of what you read, house prices are in freefall and the market is heading for a double dip.

But that's not what the figures show. The Council of Mortgage Lenders released detailed analysis of the Scottish market for the first six months of the year, showing new mortgages rising by 30 per cent between April and June compared with the first three months.

This is a stronger recovery than for the UK as a whole, where transactions were up only 20 per cent in the three months to July.

Over the first six months of this year, 22,500 loans were granted in Scotland, an 18 per cent improvement on the previous year. Across the UK as a whole, lending climbed 29 per cent, reaching 250,500.

True, advances at these levels are only half that of the boom, but at least we are moving in the right direction. The next figures available for July show gross lending up again by 5 per cent.

One worrying trend is the sharp fall in first-time buyers in Scotland, while their number is constant south of the border.

The proportion of first-time buyers granted loans has fallen from 41 per cent to 37 per cent, whereas the number remained constant at 38 per cent elsewhere in the UK.

This is surprising, given that home ownership is cheaper in Scotland than elsewhere. Buyers need only borrow 2.77 times their annual earnings to secure their dream home, compared with a price earnings ratio of 3.05 elsewhere in the UK.

Similarly, interest payments account for only 9.5 per cent of their income, the lowest level of anywhere in the UK since 1996.

Airdrie is one bank that needs no help

A GROUP of prominent Scottish business people are ploughing about 10 million into the Airdrie Savings Bank to create a "people" bank. Good luck to them, I say.

On the other hand, Airdrie, alone among Scottish banks, has been doing very well on its own for the last 175 years.

Leave them alone, I say.