17Oct
Financial system 'past danger point'
The doomsday scenario of the world financial system collapsing can
now be ruled out after widespread government interventions around
the world, the chairman of the Financial Services Authority Adair
Turner has commented.
Lord Turner told the Financial Times: "I think we are past the
point of the danger of where we were last week, where we could have
had a fundamental systemic meltdown of the core plumbing of the
world financial system."
Such a situation could mean that the recovery of the banking system
will now pick up speed, with the result being improvements in
liquidity and confidence, with lower interbank lending rates and
more mortgage finance becoming available.
Earlier this week Nationwide and the Co-operative Bank both
announced they were lowering their mortgage rates in response to
the recent base rate cut.
Nationwide said it was trimming 0.3 per cent off its fixed-rate
deals, while the Co-operative Bank will pass on the full 0.5 per
cent.
