25 Nov

Northern Rock's attitude 'forcing' other banks to lend

Northern Rock's attitude 'forcing' other banks to lend

Northern Rock's aggressive approach to lending that has seen the bank introduce increasingly competitive mortgage products is having a positive affect on the market, an expert has claimed.

Ray Boulger, senior technical manager at John Charcol, believes that Northern Rock's financial goals are pushing it to get more lenders on its books by any means possible.

The bank has stated that it wants to increase its gross lending to £4 billion by the end of 2009 and has set a target of £9 billion for next year.

Consequently, it has introduced "significantly more aggressive pricing" to meet its goals, Mr Boulger said.

This has had the knock-on effect of pushing other lenders into lowering prices and offering better deals to consumers.

"Northern Rock being more aggressive has forced other lenders to have appetites to lend," he commented.

The British Bankers' Association released figures on November 24th that indicated that small gains in mortgage lending have resulted in an increase in new mortgage lending and house purchase approvals.
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