18 Sep

Bank to extend liquidity deadline

Bank to extend liquidity deadline

The Bank of England has revealed that it is extending the deadline for high street banks to draw down from its Special Liquidity Scheme.

Originally the deadline was October 21st, but this has now been extended to January 30th in a move aimed at providing more leeway for lenders in the light of current stock market volatility following the collapse of Lehman Brothers and the takeover of HBOS by Lloyds TSB.

It said this should enable banks to proceed with accessing liquidity in an "orderly" fashion.

The move was welcomed by Council of Mortgage Lenders director general Michael Coogan, who said: "In making a clear announcement today, the Bank has shown a welcome flexibility to respond to difficult market conditions."

He added that a "removal of constraints to mortgage funding" is an important factor in the recovery of the housing market.

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