Cover of the textbook Outcomes Advanced - Student's Book

The key answer of exercise 3

The key to exercise solutions in chapter 14 - Banking on change for the textbook Outcomes Advanced - Student's Book with authors Carol Nuttall and Amanda French from National Geographic Learning

Question

With your partner, answer the questions by referring to the post.

Answer

  1. No. It was because they knew about the poor financial state of the bank and to try and cover this up and calm shareholders, they illegally lent money to someone who bought a share in the firm. This was intended to boost confidence, but they had actually lent the buyer the cash illegally. This is what they were arrested for: fraud, in essence.
  2. Not explicitly stated, but presumably because they hired excellent lawyers, evidence was hard to access, the bank itself may not have been cooperative, there were bankruptcy procedures to go through first, etc.
  3. That it’s easy to see – you don’t have to be good at maths to see that the money the UK government has given the banks to bail them out is much more than the money the banks have paid in fines.
  4. A period of austerity is a time when the government dramatically reduces public spending and makes lots of cuts to the public sector. The writer clearly doesn’t agree with it as the writer is angry about the amount spent bailing out banks – and points to Iceland to suggest another way of sorting out this problem is possible.
  5. Banks were part of local communities and so were more likely to protect investments, support local firms, and avert risks as people working in the banks may even have known the people whose money they held.
  6. Optimistic. The writer sees the Icelandic situation as offering an alternative model of hope, believes we can change things for the better and believes banks can return to a more people-centred way of working.