One of Britain's best-known banks, First Direct, shut its doors to new mortgage customers last night amid a growing exodus by lenders that is likely to force up borrowing costs for all home buyers, The Independent reports.
First Direct said it was taking the "drastic" step of pulling out of offering mortgages to anyone other than existing customers after being overwhelmed with applications for its home loans following recent price increases by other leading lenders.
Several other lenders, including NatWest and Scottish Widows, also increased borrowing costs yesterday or tightened their lending rules, raising fears that all first-time buyers will soon require a minimum 10% deposit in order to get on to the housing ladder.
That would mean a typical new buyer in London would have to save up around £25,000.
THE AMERICAN ECONOMY faces a painful recession that will be deeper than the downturn at the start of this decade and the most severe since the early Nineties, the International Monetary Fund (IMF) is set to predict next week, The Times reports.
A leaked draft of the twice-yearly World Economic Outlook yesterday fuelled fears for American prospects, revealing that the IMF is to forecast US growth of a meagre 0.5% this year.
If confirmed, this would mark a drastic cut in the IMF’s existing US projections to only a third of the previous expected growth rate of 1.5% and point to the weakest year for the US economy since the recession of 1991, when GDP fell by 0.2%.
CLARA FURSE, CHIEF EXECUTIVE of the London Stock Exchange, was one of a number of company directors to transfer or sell shares on the eve of controversial changes to the capital gains tax regime, The Telegraph reports.
The share deals came as many of Britain's leading entrepreneurs and business owners also rushed to complete the sale of their firms ahead of the Government's abolition of taper relief on capital gains tax (CGT), which will increase the rate of tax by up to 80%. The changes come into effect on April 6.
Despite the credit crisis, there have been 532 deals involving British companies worth less than €400m (£315m) since the start of the year, according to Dealogic. This round of frenzied deal-making involving companies of that size is the highest since the height of the dotcom boom in 2000.
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