GloomMonger Posted July 27, 2011 Share Posted July 27, 2011 http://uk.news.yahoo.com/banks-tap-emergency-boe-funds-first-time-2-103322928.html Banks borrowed a daily average of 3 million pounds in emergency funds from the Bank of England in the month ending July 9, the first time in more than two years that institutions have used the facility, central bank data showed on Wednesday.The Bank's standing lending facility was last used in the period ending April 8, 2009, when banks borrowed a daily average of 43 million pounds. Banks must pay a premium to use the facility, with a rate of 0.75 percent to borrow funds, 25 basis points above official interest rates. The Bank does not provide a breakdown of the number of banks that used the facility, or how much was borrowed at any one time. The standing deposit facility -- which enables banks to park their cash at the central bank -- has not been used at all since the period ending March 4, 2009. The Bank's standing facilities have two aims: firstly, to keep overnight market rates in line with the official Bank rate of 0.5 percent. Secondly, the facility is also intended to help banks manage unexpected "frictional" payment shocks resulting from technical problems in banks' own systems or in the market-wide payments and settlements infrastructure, which prevent them from settling their books at the end of the day. Not long now Quote Link to comment Share on other sites More sharing options...
rantnrave Posted July 27, 2011 Share Posted July 27, 2011 http://uk.news.yahoo...-103322928.html Not long now That's an amazing find - absolutely fascinating. Many thanks for posting! Anyone know when the banks first turned to the BoE last time and how long after things went POP? Quote Link to comment Share on other sites More sharing options...
Si1 Posted July 27, 2011 Share Posted July 27, 2011 (edited) and at the same time a top 10 lender and recipient of BoE funding, the YBS, has bought Egg's savings account book in order to expand it's mortgage business by lending more this comes from the organisation who's chairman said of the credit crunch 'nobody could have seen this coming' and which is locationally literally half way between B&B's now empty former head office, and HBOS Yorkshire head office campus (10 miles or so) Edited July 27, 2011 by Si1 Quote Link to comment Share on other sites More sharing options...
interestrateripoff Posted July 27, 2011 Share Posted July 27, 2011 What's libor doing? Is liquidity starting to dry up? Quote Link to comment Share on other sites More sharing options...
bricor mortis Posted July 27, 2011 Share Posted July 27, 2011 What's libor doing? Is liquidity starting to dry up? Im assuming its been cheaper to go via the Bof E than Libor ? Quote Link to comment Share on other sites More sharing options...
MrFlibble Posted July 27, 2011 Share Posted July 27, 2011 Is that the sound of Mr Reality's footsteps I hear coming towards the front door? If so Merv will be fondling the printing press once again... Quote Link to comment Share on other sites More sharing options...
payback period Posted July 27, 2011 Share Posted July 27, 2011 Sounds like one of the smaller banks/building socs is in trouble.....a daily average of £3m is peanuts Quote Link to comment Share on other sites More sharing options...
Billy Ballyckz Posted July 27, 2011 Share Posted July 27, 2011 Nationwide has been very quiet lately.... Quote Link to comment Share on other sites More sharing options...
fluffy666 Posted July 27, 2011 Share Posted July 27, 2011 and at the same time a top 10 lender and recipient of BoE funding, the YBS, has bought Egg's savings account book in order to expand it's mortgage business by lending more this comes from the organisation who's chairman said of the credit crunch 'nobody could have seen this coming' and which is locationally literally half way between B&B's now empty former head office, and HBOS Yorkshire head office campus (10 miles or so) is that Yorkshire Building Society? The ones currently offering a 3.49% 5-year fix.. Wondered how that was remotely affordable. Quote Link to comment Share on other sites More sharing options...
Si1 Posted July 27, 2011 Share Posted July 27, 2011 is that Yorkshire Building Society? The ones currently offering a 3.49% 5-year fix.. Wondered how that was remotely affordable. they would seem to have positive cash flow but I doubt they are particularly solvent looking forward - and they have hoovered up several other smaller building socs, I knew some managers there and they were always universally bullish on house prices, only thing saved them so far have been money-market restrictions for building socs AFAIK and yet they continue to aggresively chase the mortgage market Quote Link to comment Share on other sites More sharing options...
anonguest Posted July 27, 2011 Share Posted July 27, 2011 Surely this must be some mistake? Were we not all told just a week or so back that ALL the UKs banks passed their 'tests' with flying colours?! and that they are well capitalised?! etc etc. Quote Link to comment Share on other sites More sharing options...
rw42 Posted July 27, 2011 Share Posted July 27, 2011 "Banks must pay a premium to use the facility, with a rate of 0.75 percent to borrow funds, 25 basis points above official interest rates." Diddums :/ Quote Link to comment Share on other sites More sharing options...
moneyscam Posted July 27, 2011 Share Posted July 27, 2011 Not seeing any signs of stress here in Libor market. Quote Link to comment Share on other sites More sharing options...
Bloo Loo Posted July 27, 2011 Share Posted July 27, 2011 quite. not necceselery. The article is carefully worded. Does it mean A BANK borrowed on average £3m, overnight, or that ALL BANKS on average borrowed £3m overnight, or that the average borrowing by banks was £3m overnight. Quote Link to comment Share on other sites More sharing options...
Sour Mash Posted July 27, 2011 Share Posted July 27, 2011 "Banks must pay a premium to use the facility, with a rate of 0.75 percent to borrow funds, 25 basis points above official interest rates." Diddums :/ Yeah - must be crippling to have to pay 0.75% interest, they're really penalising the banks inability to balance their books. I wonder what the market is charging? Quote Link to comment Share on other sites More sharing options...
Lord D'arcy Pew Posted July 27, 2011 Share Posted July 27, 2011 Has this anything to do with the Post Office accounts being unavaiable today? They are run by an Irish bank with a British banking licence. Quote Link to comment Share on other sites More sharing options...
winkie Posted July 27, 2011 Share Posted July 27, 2011 What's libor doing? Is liquidity starting to dry up? http://markets.ft.com/RESEARCH/Markets/DataArchiveFetchReport?Category=BR&Type=MNY&Date=01/01/0001 Quote Link to comment Share on other sites More sharing options...
Snugglybear Posted July 27, 2011 Share Posted July 27, 2011 Has this anything to do with the Post Office accounts being unavaiable today? They are run by an Irish bank with a British banking licence. Some Post Office accounts are currently run by the Bank of Ireland. Not the ISA's or Child Trust Fund accounts, though - they're Family Investments. Also, the old Post Office Travel Money cards, which were issued by the BoI, were withdrawn earlier this year. The new Travel Money Plus card is issued by the Clydesdale Bank. I wonder if this is an indication of which way the wind is blowing. Quote Link to comment Share on other sites More sharing options...
Ah-so Posted July 27, 2011 Share Posted July 27, 2011 not necceselery. The article is carefully worded. Does it mean A BANK borrowed on average £3m, overnight, or that ALL BANKS on average borrowed £3m overnight, or that the average borrowing by banks was £3m overnight. It has got to be billion, not million. Yahoo must have got it wrong, unless the borrower is some teensy weensy little bank or building society, for whom £3m matters, but not to anyone else. For the big players, £3m is such a ridiculously small amount of money - it would be like us going to the bank for a loan of 3p. Quote Link to comment Share on other sites More sharing options...
kilroy Posted July 27, 2011 Share Posted July 27, 2011 It has got to be billion, not million. Yahoo must have got it wrong, unless the borrower is some teensy weensy little bank or building society, for whom £3m matters, but not to anyone else. For the big players, £3m is such a ridiculously small amount of money - it would be like us going to the bank for a loan of 3p. Southsea? They went bust on 16th June I think, and this data is for month prior to 9th July. Quote Link to comment Share on other sites More sharing options...
Bloo Loo Posted July 28, 2011 Share Posted July 28, 2011 It has got to be billion, not million. Yahoo must have got it wrong, unless the borrower is some teensy weensy little bank or building society, for whom £3m matters, but not to anyone else. For the big players, £3m is such a ridiculously small amount of money - it would be like us going to the bank for a loan of 3p. which is why the wording is so careful. An average of all the banks taking the funds could well be £3m, while most take 0, one could have taken a couple of bn. Of course, you are insolvent if you are 3p out....they would have to put that right with a temporary loan..otherwise we would have the situation of answering the question of just how much insolvency is insolvent. Quote Link to comment Share on other sites More sharing options...
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