HSBC will increase mortgage lending by 20 percent in 2009

HSBC Holdings Plc (LON:HSBA) have vowed that they will boost the mortgage market in 2009 by increasing it’s lending by 20 percent. The move has pleased government officials who have been urging building societies and banks to resume lending in a bid to get the worsening housing market moving again.

Mervyn King, the Bank of England Governor said that the most pressing challenge the government has to deal with is to get the banks to resume lending, the Chancellor Alistair Darling also said that he would be stepping up the pressure on banks this week which did not pass on the full interest rate cut.

HSBC have said they will be injecting a further £15 billion into its mortgage fund for 2009, that’s almost double the funds HSBC lent out in 2007 plus 20 percent increase on 2008.

HSBC was one of the first banks to pass on the full 1 percent rate cut to its customers who held tracker mortgages that pegged the Bank of England base rate. However the bank only passed 0.8 percent of the interest rate cur onto its Standard Variable Rate (SVR).

Source: GuardianRush Hour 2 download