the Business Forum and
the Economic Partnership
in Brighton & Hove
Homepage    BCRP Intranet    Funding    Events    Knowledgebase    Links    About us     Contact us
Key projects



Workforce development 


Business &

Property &
Development sites




Consultation opportunities

Brighton & Hove Business Forum
8-11 Pavilion Buildings, Brighton, BN1 1EE
Tel: 01273 735442
Email: info@brighton

© Brighton & Hove
Business Forum

News - 8 October 2008

£50bn bailout for UK banking system as interest rates are cut

The UK government has announced details of a rescue package for the banking system worth up to £50bn and cut interest rates by half a percentage point..

Initially the money will be available to eight of the UK's largest banks and building societies - Abbey, Barclays, HBOS, HSBC, Lloyds TSB, Nationwide, Royal Bank of Scotland and Standard Chartered.

The details include: -

  • Banks will have to increase their capital by at least £25bn but in the face of reluctance of banks to lend to one another they can borrow from the government to do so.
  • An additional £25bn in extra capital will be available from the government in exchange for preference shares in the banks which pay a fixed rate of interest instead of a dividend. This has to be paid before other shareholders receive anything but they do not give voting rights to the holder.
  • £200bn will be available in short-term loans from the Bank of England, double the amount already pledged
  • Up to £250bn will be available at commercial rates to guarantee loans made between banks to encourage them to return to lending to each other.
  • To participate in the scheme banks will have to sign up to an FSA agreement on executive pay and dividends.

Much of the current crisis has been caused by the unwillingness of banks to lend to each other, so the government hopes that if those loans can be guaranteed then lending will resume. It is hoped that the deal will get the money markets going again and restore confidence in the banking system.

Meanwhile six central banks - including the Bank of England - have cut their interest rates. In the UK the interest rate is now 4.5%, down from from 5%.

The US Federal Reserve, European Central Bank (ECB) and the central banks of Canada, Sweden and Switzerland all reduced rates at the same time in an effort to steady a faltering global economy and slumping stock markets.

Read related items on:
Interest Rate
Bank of England

Browse our business Knowledgebase or search by keyword


20 March 2018
Brighton names most entrepreneurial city AND second best for student happiness according to Fresh Student Living
19 March 2018
A Meeting with Chris Fox, Lib Dem Peer - Why Business Matters 14 March 2018
Better Business for All Event with BEIS 7 March 2018
Brighton celebrates women in tech as Spring Forward festival returns for a fourth year 6 March 2018
Six months of success for BTN BikeShare 2 March 2018
Sustainability in Action masterclasses for Sussex businesses 2 March 2018
Doing Business in China comes to Brighton 1 March 2018
Brighton & Hove Chamber of Commerce presents: Protecting your brand- a guide for fast growth businesses 1 March 2018
Long haul passengers boost local economy and jobs, according to new Gatwick report on the 'Visitor Economy' 28 February 2018
Save time reporting crime 27 February 2018
Warren Morgan Resigns from Brighton & Hove City Council 23 February 2018
Brighton Technology Company, Paxton Ranks in Sunday Times 100 Best Companies to Work For 23 February 2018
Greater Brighton's Commercial Property Database 22 February 2018
SE-ASSIST - Launch of Loan Capital in Greater Brighton 19 February 2018
House Price update Q4 2017 19 February 2018
What would you do in a crisis? 19 February 2018
The investment journey for high growth entrepreneurs 9 February 2018
Make Change Count 2018 - helping rough sleepers in Brighton & Hove 8 February 2018
Brighton Technology Company Paxton Announces Recipients of New Scholarship Programmein Association with the University of Brighton 8 February 2018
Cyber London Accelerator Invites Summer 2018 Entries 8 February 2018
Innovate UK Launches Strand 2 Emerging and Enabling Technologies Sector Competition 8 February 2018
Success In Sussex As Food And Drink Heroes Crowned Winners 8 February 2018
UK Games Fund - Fourth Round Open to Applications 8 February 2018
Innovate UK & Prince's Trust Launch Young Innovators' Programme 6 February 2018
Brighton & Hove Food Partnership launches 'Kit Out The Kitchen' crowdfunding campaign 2 February 2018
Brighton & Hove Council and Crest Nicholson win £15m government funding to kickstart King Alfred project 1 February 2018
Could a Utilise Plus Programme grant help you? 1 February 2018
Shoreham Port Facilitates Huge Operation 18 January 2018
IUK Announces Collaborative R&D Funding for Connected and Autonomous Vehicles Simulation 18 January 2018
Renault-Nissan-Mitsubishi Launches $1 Billion Corporate Venture Capital Fund for Next Generation Mobility 17 January 2018
PORTlife #17 Newsletter Out Now 17 January 2018
Over £19,000 raised for Burning the Clocks 2017 11 January 2018
Brighton Main Line Improvement Project: Planned closures in October 2018 and February 2019 11 January 2018
Come on in! Fairtrade Fortnight 2018 8 January 2018
Sussex Business SkillSnap targets hospitality industry skill shortage 3 January 2018
House Price update 2017 Q3 20 December 2017
£14.35 Million European Regional Development Fund Launched 19 December 2017
Leading the way - Sustainability in Action masterclass 15 December 2017
Brighton is among the best places to start a business due to their strong growth factors 15 December 2017
GTR consultation ends 20th Dec 2017