View more on these topics

CML says specialist lenders are not helped by rescue package

The Council of Mortgage Lenders has welcomed the £50bn rescue package for banks announced by the Government this morning, but has criticised it for excluding specialist lenders.

The deal is in addition to £200bn of liquidity that will be made available by the Bank of England for short-term borrowing.

The CML believes the steps address both funding and capital and provide the short-term framework to enable banks to raise finance and the longer term strengthening of their capital position.

It says this should also help to underpin consumer confidence that the tripartite authorities will actively manage the problems of the current downturn in the economy.

But the CML says while both banks and building societies are eligible, the scheme does nothing to help specialist lenders.

CML director general Michael Coogan says: “From what we can see so far, this seems to be a decisive, coordinated and reasonable package of measures that address both the relevant factors necessary to support a return to market stability. The flow of funding to support mortgage lending has been severely constrained, and these measures will help to create more positive conditions for the mortgage market.”

The FSA has also welcomed the rescue package. It says it will now work with banks and building societies to ensure they utilise the measures in a manner that delivers very strong capital and liquidity plans to navigate through the current uncertain economic climate.

FSA chairman Adair Turner says: “The comprehensive package announced today will ensure that our banks and building societies are undoubtedly robust. It should restore confidence to the whole financial system.

“We will continue to work closely with firms, and with our colleagues at the Bank of England and the Treasury, to steer our financial infrastructure through the current global turmoil in good shape to meet the needs of consumers, businesses and society as a whole.”

Recommended

‘Money Guidance causing confusion’

The proposed Money Guidance scheme is causing confusion in the industry as only one-fifth of advisers would sign up to it, according to Aifa research. The trade body says its view is that Money Guidance requires more work before advisers will throw their weight behind it.

A switch in time

Over the past few years, the UK financial advice market has witnessed huge growth in the use of platform offerings. This has been fuelled by the impressive number of benefits that platforms offer to both advisers and their clients.

IP message is not reaching employees

Advisers and employers are failing to take advantage of the group protection market despite it accounting for 70 per cent of income protection business and 40 per cent of life business, says Swiss Re.

Artemis Global Income: Making sense of global markets

The rally in cyclical ‘value’ stocks paused for breath in February, as investors took a more cautious tone and switched their attention back to defensive areas. In this article, Jacob de Tusch-Lec, manager of the Artemis Global Income Fund, explains how he has positioned the portfolio, given the many economic, geopolitical and policy risks that […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment