Barclays needs central bank loan - Democratic Underground

Henny Penny

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Fri Aug-31-07 05:21 AM
Original message

Barclays needs central bank loan

Source: BBC

"Barclays says that a "technical breakdown" in the UK's clearing system forced it to borrow £1.6bn from the Bank of England.

It is the second time this month that the bank has tapped into the central bank's emergency credit line, sparking fears it is facing a cash crisis.

But the UK bank insisted it was "flush with liquidity". "

**********************

""Had there not been a technical breakdown, this situation would not have occurred," Barclays said in a statement.

"In these challenging times the dramatisation of such situations is of no help to markets, their members or their customers."

On 20 August, Barclays was forced to take out a £314m loan from the Bank of England after HSBC was unable to process a last-minute request for the money. "

Read more: http://news.bbc.co.uk/1/hi/business/6971731.stm

For those who don't know, Barclays is one of the main UK banks.

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Phoebe Loosinhouse

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Fri Aug-31-07 05:25 AM
Response to Original message

1. Considering the info, your user name is so weirdly appropriate. Uh oh. nt.

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Henny Penny

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Fri Aug-31-07 06:32 AM
Response to Reply #1

3. lol. you'll notice that with a lot of my posts! :-)

Are you Phoebe "loose in house" or Phoebe losing house"?

The former I hope.

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Phoebe Loosinhouse

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Fri Aug-31-07 07:45 AM
Response to Reply #3

5. Definitely the former. The second never ocurred to me. nt

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MaineDem

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Fri Aug-31-07 05:42 AM
Response to Original message

2. This is not good

Barclays now. Bank of America and Citibank last week. This does not bode well for the banking sector.

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Henny Penny

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Fri Aug-31-07 06:37 AM
Response to Reply #2

4. You can probably add DeutscheBank to the list.

What is worrying is the way a "technical glitch" can force you to borrow 1.6 billion pounds that same day. That must be over 3 billion dollars! with interest presumably.

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CountAllVotes

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Fri Aug-31-07 09:19 AM
Response to Original message

6. kick & recommend

Hey folks! Wake up! This is not uniquely a problem to be found only here in the USA!

:kick:

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