Tuesday, Nov 25, 2008
King: Banks need more $$
Bloomberg: King Says British Banks May Still Need More Capital
Bank of England Governor Mervyn King said U.K. financial institutions may still need more capital and the “single most pressing challenge” facing policy makers is to revive the flow of credit through the economy.
Posted by 51ck-6-51x @ 11:10 AM (327 views) Add Comment
4 Comments
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1. stillthinking said...
Our banks have foreign liabilities equivalent to over 200% of our GDP, but they are still concerned with the UK housing market and our ability to buy stuff on tick.
Its sweet of them in a way.
2. c'mon correction said...
So that's why I was still able to get a 6.6% fixed rate bond even after base rates were cut to 3%. With RPI set to hit 0%, I'll be getting over 5% above inflation after tax. My savings have never worked so hard!
It's going to be harder and harder for the banks to find safe capital from despositers if you keep slashing rates Mr King.
I was speaking to two corporate managers from RBS and Barclay's two days ago, they both had the same view that margins on mortgages/loans will never ("not in out lifetime") return to the lows seen in the past decade and that both the internal views from each bank suggest it will be 2011 until the credit market is functioning normally again.
3. crash bandicoot said...
I'm always slightly puzzeled by the talk of "credit markets functioning correctly" to describe above average LTV mortgages, being given to buy inflated value houses, at artificially low interest rates. Even if the govenment throws more money at the banks (as Ray Boulger was bleating for today) you can hardly blame them for not returning to the "correct" lending practices that I have just described.
4. fjcruiser said...
No matter what the government says, what the BOE says, that the FTSE was up almost 10% yesterday, the UK default protection rate keeps ticking up.