Barclays Bank takes out huge Loan
The emergency lending facility made available by the Bank of England was used recently by Barclays Bank.
The high street bank which normally makes it's money by arranging loans to customers was left needing a huge loan itself recently when it realised late one day that it would be unable to balance it's books and needed a short term overnight loan of £1.6bn.
Barclays tried to play down the situation saying it was quite normal for the big banks to make overnight loans to each other, but that on this occasion it realised too late that it needed the money and there was not enough time to make arrangements with another bank.
Money Review's Opinion
Money Review thinks this is usual business for the big banks, in fact Barclays recently borrowed over £300 million from HSBC overnight. The strange thing this time was the amount borrowed and the level of press coverage it received. Barlcays' share price had already taken a 20% hit over recent weeks and the Bank reacted strongly saying that all the attention wasn't doing them any favours. A big fuss about nothing they claimed.
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