Foreign Perspectives

Archive for the ‘Business’ Category

The liquidity ratio of a bank is something that doesn’t matter to most people but it’s something that has become rather important following the collapse of the Northern Rock.

Oh, sorry, it didn’t collapsed. It just didn’t have any money of its own to give out to its customers.

What the liquidity ratio is is the percentage of the assets of the bank that are held in cash ie the amount that they can actually pay out. For the UK, the average liquidity ratio is just 3%. That might seem pretty low but in reality it’s more than enough as there’s obviously a constant flow of deposits and withdrawals.

However, when the flow is all outwards as in the case of the Northern Rock, that 3% isn’t really enough and that’s when they need to pay a visit to the Bank of England to ask for a few quid to keep them afloat.

As we said last before, the Northern Rock is finished. In reality that probably doesn’t matter as it’ll be taken over by one of the banks that were very keen to buy it just a year or two back. Let’s not forget that that they were very highly thought of not so long ago as an excellently run mortgage bank which just goes to show that having an excellent reputation doesn’t mean that a bank is “safe” (the Equitable Life was also very well run, of course).

This all begs the question as to whether the Bank of England should support the Northern Rock. After all, it didn’t support BCCI in 1991. What’s different is that the Northern Rock is a UK owned institution and the BoE want to maintain the image of the UK banking system being a safe place to bank. Something to bear in mind when looking for somewhere to deposit your money as several of the banks paying the top savings rates aren’t UK owned.

That’s one of the negative comments that we received recently. Slightly ironic though in that the comment was from a German family of which only one of the four could speak any French and he couldn’t speak much.

However, we’ve now reached the point where we expect that French guests will criticize us for not being French. At least that is if they come from the Dordogne where we can understand their opposition to English as it’s often treated by the English as though it were the far south of England. Somewhat more peculiar though are those from Alsace who are historically German of course but who are, by now, more French than the French with a lot more depth to their French ancestry.

What’s also been a feature this year is that we’ve had a LOT more Germans, Dutch and Spanish than normal and have around 90% non-French for quite extended periods sometimes. That’s given rise to criticisms from some of the French guests that French isn’t being spoken in the dining room or rather that English is being used by everyone else but them.

That’s something that we’d never thought about before. After all, in the majority of hotels around the world, it’s English that’s used between guests of different nationalities and, on the whole, it’s the language you’d most commonly hear during breakfast. Yet, in France the French expect the most common language to be French. Weird.

We’ve had quite a peculiar pattern of bookings right through the whole of the summer this year and it looks like it’ll finish on an odd note too.

Normally at this point in the year we’d be finding we finished the day with a number of empty rooms as the French holiday season draws to a close but we’ve had next to no French staying this year so their influence on the overall booking pattern has been negligible. What has been more noticeable is a very significant rise in Spanish and German bookings and separately in the massive number of last minute bookings that we’ve been getting.

We’re finding that if we put a room back on the system due to a cancellation then often it’s filled within 30 minutes. A year ago that happened now and again but this year it’s been a large feature of the bookings.

Now, we’re not complaining about last minute bookings per se but it does mean that our planning is totally thrown as even a full week of empty rooms can fill pretty quickly.

If you’re living outside your home country then the answer isn’t an obvious one.

Say you’re living in France and you’re from the UK. In that case, the language you use within the family will be English whilst the language you use outside the home will usually be French, won’t it?

Well, not necessarily. For example, in our case for a variety of reasons this year less than 10% of our guests were French. Thus, in practical terms in 90% of the time we ended up using English with the guests. That’s not because they were British mind you because under 10% were; it’s because of that 90% non-French clientele, almost all of them had a preference to communicate in English rather than French (they were largely German and Dutch).

Which has resulted in a series of odd complaints, mainly from the French guests. We weren’t greeting everyone in French, nobody spoke French, etc. Seeing as we can see where the various cars come from as people arrive we actually greet them in the most appropriate language we can muster whether that be English, French or Spanish. If it’s a German number plate then we kick off in English because we know that 99% of them speak it better than we do.

What we can’t obviously do is insist that all the guests speak French as one French couple seemed to want going by their complaint. In fact, they were the only French couple staying that day and were surrounded by Germans, Dutch and Spanish who all chose to speak English to each other whilst having breakfast.

The peculiar common thread behind these complaints is that the French seemingly assume that in a French hotel all the staff will be French and so will all the guests which seems pretty weird in these days of widespread international travel.

Most of the time it’s fine to take a few cards and maybe a travellers cheque with you on holiday, but what do you do if you run out of money when you’re abroad or if your cards/cheques are stolen?

It’s safest to work on the assumption that your cards and/or cheques will be stolen and prepare for that. The way to do this is to keep a note of the card numbers, expiry dates and cancellation phone numbers for each card that you are taking with you. For the travellers cheques you need to note down the cheque numbers and the date & place that you bought them. Take one copy of the note of these details with you (separate from the cards, of course) and leave one behind with a friend or family member. It’s best to cut down on the number of cards too and go with the minimum which is three: one Visa, one Mastercard and one more for when the other two are stolen (keep the third one separate from the other two).

When they are stolen, you just go through the details and call to cancel the cards and cheques. The cancellation numbers are usually reverse charge numbers ie you won’t have to pay to call the banks. It’s useful to look up the number of the international operator and/or AT&T direct number for the countries in which you’ll be on vacation in advance.

In theory, cards can be replaced abroad within 24 hours but this depends on your card, your card company and the banking system in the country in which you’re on holiday. The best cards for replacement are gold/platinum ones but unfortunately they’re also the most attractive to thieves.

However, some countries just aren’t up to replacing cards quite so easily though a combination of language problems and primitive banking systems. Nobody who has stayed with us and had a card stolen in Prague has ever managed to get it replaced whilst they were there.

So what do you do if the card company can’t manage to replace the card? That’s when you need to look into how to get money to yourself from home and there are several ways of doing that which I’ll be covering next.