Funding for Lending significantly higher in the third quarter
The Bank of England has said that lending by banks and building societies participating in the Funding for Lending Scheme (FLS) was significantly higher in the third quarter. Many of the lenders are using the funds to provide borrowers with their lowest ever mortgage rates.
In the quarter ending 30 September 2013, 21 lenders made FLS drawdowns of £5.5bn. This took the total amount of outstanding drawings to £23.1bn, with 33 groups now benefiting from funding under the scheme. One additional group borrowed funds in the third quarter this year, taking the total number of participating groups to 42.
Last week the Bank of England made changes to the FLS and decided to concentrate on providing financial support to small and medium size businesses. Mortgage rates are likely to increase from early next year, but it is difficult to predict exactly how much they will rise by.
December 6, 2013
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