UK bank shares have jumped following last night's announcement of a £100bn stimulus package for the UK economy.
The BoE and the government are set to provide billions of bounds of cheap credit to banks which they can then lend to companies, in an effort to insulate the economy from the impact of the eurozone crisis.
The new measures will see the banks given funding from the Bank of England below market rates, providing they sustain or increase lending to non-financial businesses.
The additional liquidity sent bank shares soaring this morning.
Shares in the Royal Bank of Scotland are up 7.13% to 246p, while Lloyds is ahead 6.18% at 31.59p. Barclays is 3.75% steeper at 300p.
The wider FTSE 100 was up 0.8% at 5,510 points.
At Mervyn King's annual Mansion house speech last night, the governor promised to provide extra support to the banking sector in response to the weakening macroeconomic picture over the past month.
He said the Bank was ready to provide extra measures of support to the financial sector and the real economy.
King said the Bank will also activate the Extended Collateral Term Repo Facility announced last December, under which the Bank can hold auctions of sterling liquidity with a maturity of six months.
"It is now time to activate [the] scheme, in the words of the Bank's Red Book, 'in response to actual or prospective market-wide stress of an exceptional nature' over the coming weeks," he said.
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