HBOS, the UK's biggest mortgage lender, along with other major sources, has agreed to pass on the full benefit of the Bank of England's 1.5% cut in interest rates. They had been under tremendous pressure to do so from Alistair Darling, the British Chancellor.
The high street banks have come under fierce criticism, from the popular Press, for not responding more quickly to recent cuts. However, they have now taken action within a day of the latest unexpected cut. There are many who hold bankers responsible for the international credit crunch, and it is undeniable that they have played a part. As the banking fiasco resulted in a taxpayer bailout, many of whom have mortgages, there was a head of steam building up for interest rate cuts, and it was essential that the bankers start to play ball.
Please Click Here to visit the Free Mortgage Advice Web Site.
It seems that the executives of the major banks attended a breakfast meeting, and were left in no doubt of the UK government's expectations. As UK taxpayers, through their government, are now major shareholders in the banks, there were some who were demanding that a stronger line be taken to protect their interests, including interest rate adjustments in favor of mortgages and businesses.
Although the banks agreement to pass on the recent interest rate cut in full is welcome, there are many who consider that they should have responded to the requirement, without what amounted to a public outcry. There has been a lack of confidence in the banking sector, with banks being reluctant to lend to each other. That situation was in danger of spreading, and creating some sort of stalemate whereby no funds were available for normal banking functions. The Chancellor has shown that he is prepared to get tough, if the need arises, but it may be that in the face of so much media criticism, loan sources will act more responsibly in future.
Tags:
UK mortgages interest-rates-cut
UK mortgages interest-rates-cut
No comments:
Post a Comment