Moneyfacts comments on the Governments bank rescue
Darren Cook, Head of Press at Moneyfacts.co.uk, comments:
“Moneyfacts supports the unprecedented action announced by the Government this morning. These actions further demonstrate that Downing Street will indeed take any action that is needed to try and return the banking system to a level of normality.
“This latest government rescue plan of £37bn, together with the commitment from major UK banks to free up the money markets, may be the decisive moment when banks start to regain a healthier appetite to lend and slowly switch on the taps to much needed funding.
“It is not only homeowners unable to remortgage to a cheaper deal who will be holding their breath in anticipation over the ensuing weeks: small and medium enterprise will be doing the same after witnessing that short term funding avenues have been closed during recent weeks.
“Consumers may not be able to see tangible benefits of the Government’s actions in the short term. However, no action by the Government would have resulted in a possible meltdown of the banking system which would have adversely affected every household in the UK.
“Existing borrowers with Northern Rock have today been notified that their SVR will only be reduced by 0.15%, to 7.34%. This will be unwelcome news to those customers who were afforded higher loan to value mortgages in the past, sometimes in excess of 100%, but who have now found it impossible to remortgage to a better deal.
Moneyfacts Group
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