Cable slams government bank plans

04/11/2009

Vince Cable has strongly criticised newly-announced banking reforms from the government.

The Liberal Democrat shadow chancellor said that he was "appalled" by some parts of the £40 billion bailout, announced by chancellor of the exchequer Alistair Darling yesterday (November 3rd).

It was confirmed that Lloyds Banking Group, 43 per cent owned by the taxpayer due to a previous bailout, will not participate in a new government plan to provide insurance against future losses from "toxic assets" held by the bank.

However, RBS, which is now to be 85 per cent public-owned, will participate in the scheme.

The government will also inject a further £40 billion into the two firms under the government plans.

Banks have suffered severe financial damage due to the credit crunch and economic downturn that have affected the UK over recent months.

Bailout schemes have been launched for the firms to protect them against collapse - because the government believes that such a failure would cause an unacceptable amount of damage to the economy as a whole.

Responding to the chancellor's announcements, Mr Cable said: "Why are banks continuing to receive taxpayers' money and being allowed to pay bonuses when they are continuing to restrict credit on reasonable terms to numerous, solvent, small and medium sized businesses?

"I was appalled to hear that Lloyds are not only being given more money but are seeking to extricate themselves from their lending agreement."

Tags; Current UK Economy, Young Family Finances, Retirement Money Problems, Recent Graduate Debt,

• Share
• 
• 
• Store
• 
• Follow
•