Barclays emerged last night as the financial institution that borrowed £1.6bn from the Bank of England's credit facility - the second time this month that the high street bank has had to obtain emergency funding from the UK's lender of last resort, The Times reports.
Barclays said that a technical glitch with the market settlement system forced it to turn to the central bank for funds. The identity of the bank with a £1.6bn shortfall galvanised the City yesterday, coming amid renewed concerns about the willingness of banks to lend to one another.
Concern over solvency after the credit crisis have sent the cost of some borrowing between banks soaring. The London Interbank Offered Rate (Libor), at which banks lend between each other for 90 days, rose yesterday to 6.63%. With the base rate expected to stay at 5.75% over the next three months, analysts said that the huge premium for borrowing was a sign that banks were refusing on a huge scale to lend to one another, despite the clear opportunity for profit.
ONLY A HANDFUL of top companies in continental Europe and the US are led by UK executives, despite claims that high levels of boardroom pay are essential to prevent a management brain drain, according to The Guardian.
The Guardian/RTF survey of executive remuneration revealed this week that average pay for directors at Britain's top companies rose 37% last year, with chief executives making on average £2.875m. Supporters of such high levels of pay say that British talent would migrate overseas if the price wasn't right at home.
Analysis of Germany's Dax 30, the Dow Jones industrial average and the companies that make up the Euronext 100 - in France, Portugal, Holland and Belgium - reveals less than half a dozen are run by UK chief executives.
THE RECENT TURMOIL in financial markets could cost the Exchequer as much as £10bn per year in lost revenues, The Independent reports.
Research by Credit Suisse based on past market downturns suggests that a 10% fall in real share prices "might eventually be associated with a 7.5% fall in business investment and a 2.5% fall in consumer spending.
The larger part of the impact on business investment comes through over a two to three year period. It takes longer in the case of consumer spending". This would equate to about 2% of GDP, a significant hit, with an implied reduction of around the same magnitude in Government revenues, or approximately £10bn per year by the end of the timescale.
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