I was wondering what happen if Goodbody went under?
The main issue here is not one of risk.
Goodbody going under would be a risk. Unlikely, but a risk all-the-same.
The chances of AIB going bust would be as unlikely as Enron/Barings going under. The chance of embezzlement in Goodbody would be the same as it happening to Morroghs.
If I recall correctly, those that lost out on the Morrogh debacle were nominee account shareholders. The son-in-law of the owner went trading shares in the nominee account, and repeatedly lost money, until he was caught, and the outcome was an overall loss.
Not only that, but he did the same thing 10 years earlier, got caught by the boss, the boss told him not to do it again, and gave him his job back!
This would be my biggest fear. With the shares in my name, they are mine. In a nominee account, they are not in my name and the next Morrogh could happen.
You can probably tell that I too regard this change as a downgrade, and I plan on moving.
It's looking like Sharewatch for me, because of the CREST accounts.
The NIB account sounds good but it's not crest. I first heard about it on Today FM's Business Show.
Choose
Business Show Part 2 Sunday: 22/7/2007
If you trade alot the access to Reuter's reports may be of use.
I called into the NIB branch in Donnybrook but the guy behind the counter got a bit flustered by my request. He seemed like a sound bloke so I didn't press him.
A reader of the Irish Times wrote a letter to the business section on 29 June regarding share certs. I probably shouldn't paste this in, so moderator please remove this bit if it's not kosher to post it:
The failure of Ryanair to issue new share certificates following the share split is a fiasco. The longer the matter is left unattended the greater the confusion and the more difficult it will be to put matters right.
Why should shareholders wishing to sell their Ryanair shares have to write a letter to their brokers explaining that in reality they own twice the number of shares, as stated on the certificate?
Last week, I was listening to a business programme on our national airwaves and a question came in from a listener as to why the Ryanair share price had halved in the past year. The expert denied that the price had halved - technically he was correct but in another way he was uninformed. An example of the growing confusion?
The reason why many of us do not want to move away from old-fashioned share certificates is that when we place our shares in the nominee names of our brokers they charge us fees for the service (for whose benefit is the service provided? - they should be paying us!), there are delays in receiving our dividends, we are not sent the annual or interim reports or notices of agms and egms, and we miss the opportunity to attend the meetings. Takeover offers and other corporate actions are not sent to us. So I, for one, have reverted to having all my shareholdings in my own name with original share certificates.
Mr ? ???, e-mail
You respond to the recent Q&A where I suggested that a Ryanair shareholder include a letter to their broker reminding them of the fact that their "pre-split certificate" would no longer be accurate in the number of shares it states the investor holds.
You're right. It should not be necessary and, for what it's worth, I am sure the broker - checking with the share registrar - would be quick to ensure that the correct number of shares were traded. I was merely suggesting a "belt and braces" approach - just to be sure. There is, of course, no requirement for you to write a covering note to your broker. You are paying them commission and that should certainly cover the competent execution of the transaction . . . but what do you do if it goes wrong and you have no photocopy of the certificate?
I can't answer for conversations in other forums but it would certainly have been more helpful to point out, as we did in the paper in response to a similar query, that the price might appear to have halved because of the two-for-one share split that would effectively halve the value of each unit.
Such confusion only reinforces my belief that it never does any harm in cases like Ryanair at the moment to include the covering note suggested.
In any case, if the Irish Stock Exchange had its way, and I'm sure it will, share certificates will very shortly be consigned to museums. The exchange is proposing to move to a fully electronic means of holding shares.
However, this does not necessarily mean you are deprived of all information and control over companies in which you have invested.
While it is certainly true that electronic holdings in nominee accounts are lumped together, with brokers receiving all corporate information and having control over decision-making, the same is not true of Crest accounts.
These are also electronic accounts - and yes, you will pay the broker to manage them - but the investor receives all communications from the company in which they hold the shares and makes all the voting decisions on agm and egm motions. The other advantage is that trading costs will be reduced.
I wonder if there's any chance that Goodbody would reverse their decision?
