Britain is at risk of a mass sell-off of distressed properties that would send values into a double dip and impair the lending ability of banks.
The dire warning is contained in the Bank of England’s latest Financial Stability Report, which was published last week. In the report, the Bank revealed its concerns about potential writedowns on £200bn of loans made to commercial property by major UK banks.
It warned of an increasing number of loan defaults given the 44pc fall in the value of shops, offices and warehouses since 2007. However, the Bank also described how the approach of the lenders to withdrawing from the property sector could jeopardise the economy‘s recovery.
Source – Daily Telegraph
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