Home > Uncategorized > EU to hammer house building

EU to hammer house building

Home_Building_572 Sadly I cannot link the Times article today but It would appear that the European Banking Authority has instructed lenders to categorise lending to business in precisely the same bracket as “non performing loans of borrowers who have defaulted”. For a number of reasons this is going to make lending a lot harder for smaller banks and building societies. In a market which is limited and pretty lukewarm at the present time, this is decidedly not welcome.

As a ruling this is chronically heavy handed. Bracketing one industry under one credit rating is crude at best and you really have to ask, yet again, what these bureaucrats really contribute when they have clearly found the application of a least a model of credit rating beyond them.

I also wonder if this has been in the air for sometime. Recent exploration of the commercial mortgage market on behalf of a couple of clients produced unexpected lack of interest from certain smaller banks.

However the key element here is the effect on housebuilding. Clearly this is not going to aid development and in the UK at least there is a desperate need to build

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