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Bank of England Lending to Banks
Generali
Posts: 36,411 Forumite
From the latest BoE Bulletin (page 11):
According to the original repayment schedule, twice as much should remain outstanding than actually does.
Special Liquidity Scheme
The Special Liquidity Scheme (SLS) was introduced in April 2008 to improve the liquidity position of the banking system by allowing banks and building societies to swap their high-quality mortgage-backed and other securities for UK Treasury bills for up to three years. The Scheme was designed to finance part of the overhang of illiquid assets on banks’ balance sheets by exchanging them temporarily for
more easily tradable assets.
When the drawdown period for the SLS closed at the end of January 2009, £185 billion of UK Treasury bills had been lent under the SLS....
...By end-May 2011, £148 billion had been repaid, compared with £94 billion at end-February 2011.
According to the original repayment schedule, twice as much should remain outstanding than actually does.
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Comments
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Does this mean banks are in a position to open the doors to borrowers again?0
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Blacklight wrote: »Does this mean banks are in a position to open the doors to borrowers again?
It should mean that, yes. The banks also need to shore up their reserves but that is a process that seems to be going well too.0 -
It should mean that, yes. The banks also need to shore up their reserves but that is a process that seems to be going well too.
The bulk of the SLS was advanced to LloydsHBOS. Who are reducing their mortgage book to comply with the EU requirement.
So little new net funding available. Other than HSBC who can call on Asian retail deposits to provide funding.0 -
Surely it just means that the liquidity crisis is over (for the moment), banks have managed to refinance from the market rather than the govt - it does not say anything about their capital position (I guess beyond indirectly through creditworthiness) and thus ability to extend credit.I think....0
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Surely it just means that the liquidity crisis is over (for the moment), banks have managed to refinance from the market rather than the govt - it does not say anything about their capital position (I guess beyond indirectly through creditworthiness) and thus ability to extend credit.
Don't forget that people are net repayers of debt at the moment. Also spreads between financing costs and retail debt are the highest I can remember which means that the banks are making big profits which can be used to pay down loans to the BoE.0 -
Thrugelmir wrote: »The bulk of the SLS was advanced to LloydsHBOS. Who are reducing their mortgage book to comply with the EU requirement.
Are they? Lloyds just gave us a mortgage with very little hassle, at a decent rate, too. 3.02% fixed on £450k....much enquiry having been made concerning a gentleman, who had quitted a company where Johnson was, and no information being obtained; at last Johnson observed, that 'he did not care to speak ill of any man behind his back, but he believed the gentleman was an attorney'.0 -
Well with an income multiple of 1x joint I guess they could afford to push the boat out...neverdespairgirl wrote: »Are they? Lloyds just gave us a mortgage with very little hassle, at a decent rate, too. 3.02% fixed on £450k.I think....0
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neverdespairgirl wrote: »Are they? Lloyds just gave us a mortgage with very little hassle, at a decent rate, too. 3.02% fixed on £450k.
Six hundred branches and £65 billion of mortgage debt is the plan.
Though there's a fair few hurdles to surmount as matters stand to even strike a deal with anyone.0 -
Well with an income multiple of 1x joint I guess they could afford to push the boat out...
yeah, yeah, very funny............much enquiry having been made concerning a gentleman, who had quitted a company where Johnson was, and no information being obtained; at last Johnson observed, that 'he did not care to speak ill of any man behind his back, but he believed the gentleman was an attorney'.0 -
neverdespairgirl wrote: »yeah, yeah, very funny.........
I know. Who gets out of bed for less than half a mil these days?0
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