Major bank will pump £15 billion into Home Loans

dopester

There may not be demand for the mortgage money.

It works two ways. Did in the 1930s as well.

Banks were reluctant to lend except to very good credit risks - but also public demand to borrow was weak due to job loss, fear of job loss, and general negative economic outlook.

Just because the money is being made available for mortgages doesn't guarantee high demand for new borrowing.

edgex

Yep, it is spin
HSBC were only the 8th biggest mortgage lender, even behind Abbey National
http://www.mortgageguideuk.co.uk/mortgage-rates/top-10-uk-mortgage-companies.html

Also, how much of that will they keep to themselves for re-mortgages?
Its also 'up to £15billion' , dosnt mean they will lend that much.
Could also include commercial mortgages, there will be large commercial landlords looking to pick up properties at auction next year, who may need short term funding.

Really2

abaxas wrote: »

Total secured lending = £1,220bn
HBSC lending = £15bn

15/1220 *100 = 1.23% of the marketplace.

Spin, spin spin spin.

Estimated Mortgage lending thist year £255 billion

15/255*100 = 5.88% Extra Available on 08 figures.

Really2

edgex wrote: »

Yep, it is spin
HSBC were only the 8th biggest mortgage lender, even behind Abbey National
http://www.mortgageguideuk.co.uk/mortgage-rates/top-10-uk-mortgage-companies.html

Also, how much of that will they keep to themselves for re-mortgages?
Its also 'up to £15billion' , dosnt mean they will lend that much.
Could also include commercial mortgages, there will be large commercial landlords looking to pick up properties at auction next year, who may need short term funding.

:rotfl: :rotfl: :rotfl: :rotfl:

What about the rest of the world?
I think they may be the bigest,strongest UK based bank at the moment.:rolleyes:

IveSeenTheLight

dopester wrote: »

Just because the money is being made available for mortgages doesn't guarantee high demand for new borrowing.

Fully agree, it does not mean that the available money will be taken, however......

It does mean that it quashes the argument there there is no money available

drbeat

SingleSue wrote: »

One question....where is all the money coming from?

Probably from their rip-off informal overdraft facilities. Or should I say fees?

Really2

I think the interesting thing this financial year will be to see what the actual bank Net Profit is. I think this year banks will be posting big profits but obviously this will be used to help the balence sheet for up and coming "testing times"

dopester

IveSeenTheLight wrote: »

Fully agree, it does not mean that the available money will be taken, however......

It does mean that it quashes the argument there there is no money available

HSBC are fairly shrewd operators (mostly). Press releases like this might be to deflect or lower political pressures. Sustaining the morale of the people. Of course they have money. They also have some hard-hitting shareholders. We shall see.

HSBC might have to contend with pressures in some other markets where it has a major presence (Asia), which have allowed for major profits in recent years but now look to be unwinding.

gunnaknow

post error.

WestonDave

HSBC were getting flamed a couple of years ago by a big investor group for not being aggressive enough in its lending policies - the upshot was that the investors didn't like HSBC playing safe at the cost of profits on higher risk lending. I think now we are seeing who was right in that little spat.

A while back there was a Tonight type programme on the mortgage crisis - usual dumbed down tosh but there was a useful chart which showed the various banks loans to deposits ratios - HSBC were streets above the others in terms of having more room to lend on the cash they had. This was also borne out by a work conversation I had with a senior manager who suggested that whilst they would be happy to take our deposit (which we wanted to move for safety as it wouldn't be covered in full by the compensation scheme) they had more money than they really knew what to do with.

My guess is that they currently have a war chest and are about to use it to mop up the best borrowers looking for deals in the market - we've already seen that with HSBC leaving their 60% LTV 0.99% Tracker dangling long after everyone else had taken theirs down and replaced them with 1.5%+ Trackers. I suspect if you are a decent risk very few people will find better deals than HSBC (or First Direct) for a while.

That leaves the other lenders with a bit of a brown trousers moment - do they try and engage the vastly stronger HSBC in a rates war, or do they simply have to offer deals to some of the higher LTV customers. They are certainly going to have to lend if they want to make money so who are they going to lend to? That really is the interesting fall out from this - oh and watching HSBC stick two fingers up to those who said they should have taken more risks!