- By: KARL BANTLEMAN
We were all waiting to see who would stand up and prevent the economic environment from a full scale meltdown. Gordon Brown has bailed out the high street banks with massive 500 million pound injection. The plans will mean at least 8 of the leading banks including Royal Bank of Scotland, Barclays, HBOS and Lloyds TSB will be partially nationalised.
The drastic financial lifeline that these banks have been given means hundreds of billions of pounds worth of debt are going to be underwritten by the Treasury. At the same time, the Bank of England have decided on an emergency rate cut which will go hand in hand with a global initiative to help the global financial market.
This is good news for borrowers and especially those looking for loans and mortgages as the base rate cut will be passed on to the customers. The news is brilliant for the leading banks as many have seen a stabilised market share after recent falls.
Customers looking for unsecured and secured loans should soon see some of the benefits from this £500 million bail-out. It is the first bit of good news that we have heard in the past 18 months but everyone is urged to continue saving where possible as the economy will still take a year to recover.
Many experts say the bail-out is not enough to stop the recession but it will reduce the effects. Interest rates need to be further reduced and if all goes well 2009 could be the start of a recovery. The deal to help out the UK’s leading banks is very detailed and hard to give full details but, in effect, the government is planning to raise £50 billion to buy stakes in at least 8 banks.
It is hoped that this will bring back consumer confidence about the credit market as banks rely heavily on it. Loans and credit card deals are important to banks and a rate cut is just what customers want to hear at the moment.
The new deal to help British banks should help loans deals so people who choose to look for secured loans will see a reduction in interest rates. Whether its secured or unsecured loans you want, shop online for the best deals around.