AMI welcomes BoE loan facility

The Association of Mortgage Intermediaries has welcomed the Bank of England’s move to extend its loan facility.

AMI believes the £10bn offer of three-month loans against a wider than usual range of collateral may help to alleviate current problems in the banking industry.

Richard Farr, director of AMI, says: “Although not a long-term solution to the liquidity crisis we agree with the bank’s view that the continuing elevated pressures in short-term funding markets are very real, are causing significant pain to the lending industry and are having a subsequent knock on effect on the housing market.”

Farr says AMI is encouraging the Bank of England to consider increasing the tranche that is to be released in April as the trade body expects the first tranche to be oversubscribed.

He adds: “We would also like to see the bank support the UK in providing much needed liquidity as their counter parts have done significantly in North America and Europe.”