CML to make sure government gets it right

In a statement:

"We have assessed last week’s announcements by the Treasury against broader policy objectives, and believe the government now has the main tools to maintain stability in the banking system. There are still important details to clarify, however, and we will continue to consult with lenders and work with the government to ensure the package delivers maximum benefit for mortgage and housing markets.

However, while the package addresses many concerns on capital and liquidity issues, there are still gaps in addressing credit risk. We outlined some of the threats to borrowers in our evidence to the Treasury committee on the banking crisis.

We need more comprehensive help for borrowers in difficulty, measures to help first-time buyers while reducing their exposure to risk, and action to provide more affordable housing and ease funding problems for housing associations.

Finally, lower interest rates have delivered real benefits for borrowers with tracker mortgages. But borrowing cannot be cost-free. Tracker rate collars are a prudent hedge against unusual market conditions, and help balance the interests of borrowers and savers."