Pension holders & The Co-operative Bank

Invest with proper diligence to banks that deserve trust

09:18 17 July 2013

After being downgraded to the lowest credit rating - “junk” - by Moody’s, one of the Big Three credit rating agencies, the Co-op bank reportedly gave reassurance to its pension holders that their investments are secured.

This was announced one month prior to its plan of cutting down savings for its last resort of bailout. Thinking outside the box, perhaps the Co-op bank will never be able to pay its pension holders without them investing diligently.
   
Proper diligence is one key factor for an investor to always uphold. Not only will it give investment companies the proper boost to stay in operation, it would also heighten the credit rating of that investor. There are many reasons why investing with proper diligence is a must, some of them are listed below:

• Receive timely returns of investment - Investment companies prioritize giving returns to its valued customers. They would never want their diligent customers to pull out their money due to late payment of their returns or interests.

 

• Better individual credit rating - When an investment company or a bank feels that an investor is making his payments in a timely manner, his credit rating would go up. This is advantageous to the same investor because when his credit ratings go up, banks would not hesitate to let him borrow money.

 

• Decreases risk – The potential risk of bank insolvency or even bankruptcy is minimized because your payments stimulate the finances of the bank.

 

• Justified claims - In cases where a bank is declared bankrupt or insolvent, an investor can readily claim for his investment due to his complete monthly payments to the bank. Plus, these diligent claim holders are and always will be prioritized from other holders with inconsistent payment practices.

Having proper diligence in investing money is the key for better investment opportunities.