Monday, Dec 08, 2008
State-owned bank only passing on half the cut
Times: Northern Rock snubs government
Northern Rock, the Government-owned lender, has defied the demands of Gordon Brown and announced that it is cutting its SVR by just half a point.
Last week the Bank of England reduced the base interest rate by 1%. The following day the Prime Minister demanded that banks and building societies pass on the full cut.
Melanie Bien, of Savills, says: "Other lenders may question why they should bow to government pressure to pass on the full 1 percenta. Northern Rock needs to lead by example if the government is going to have any joy in persuading other lenders to play ball."
RBS, which is 57% owned by the government, and Bradford and Bingley, which was nationalized in September, have only passed on 0.75% of the cut. HBOS is only cutting by 0.25%
Posted by little professor @ 11:12 PM (246 views) Add Comment
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