Thread: Banks called to crisis summit

Banks called to crisis summit
By Mark Kleinman, City Editor
Last Updated: 1:46am BST 13/04/2008

The heads of the country's biggest banks and mortgage lenders have been summoned to talks in Downing Street by Gordon Brown and Alistair Darling to discuss the crisis in the housing market.

The Prime Minister and his Chancellor have convened a breakfast summit to take place at Number 10 on Tuesday morning to attempt to navigate a way through the turmoil that has in effect paralysed Britain's mortgage?lending industry.

advertisementIt comes after the failure of last week's interest rate cut by the Bank of England to feed through to the Libor - the rate banks charge each other to borrow money.

Tuesday's meeting will be attended by senior executives of Abbey, Barclays, HBOS, HSBC, Lloyds TSB, Nationwide and the Royal Bank of Scotland.

Mr Brown and Mr Darling will discuss possible ways to kick-start mortgage lending in a bid to avert a fully?fledged crisis for hundreds of thousands of borrowers. They will also discuss last week's International Monetary Fund meeting of the G7 finance ministers in Washington.

"The agenda is all about the housing market, promoting inter-bank lending and the general market conditions," said a source familiar with the arrangements for the meeting.

The latest Downing Street talks will underline the Government's impotence in tackling the credit crisis, which has caused the international money-lending markets to seize up.

The reluctance of banks to lend to one another has led analysts to predict that net mortgage lending in Britain could more than halve from £108?billion to about £50?billion this year. The number of active lenders is understood to have fallen from about 100 a year ago to 30.

http://www.telegraph.co.uk/money/main.j ... nks113.xml

Saving banking from the bankers
Published: April 11 2008 19:59 | Last updated: April 11 2008 19:59

This week the world’s leading banks – represented by the Institute of International Finance – concurred with a conclusion long ago reached by the rest of the world: they screwed up, the credit crisis is largely their fault, and everybody else is suffering for their errors. The admission may not be enough to prevent a dangerous backlash.

Bankers may have realised, too late, the dangers of the banker caricature many people now believe. The popular perception is of an industry populated by clever crooks who manufactured toxic derivatives of subprime loans, repackaged them to look succulent, and sold them to greedy fools.

http://www.ft.com/cms/s/d912a4fc-07f5-1 ... nse.com%2F