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Bank Lending to UK Property Companies Soars to Record Levels

LONDON-Bank lending to property companies in the UK has reached record levels, according to new data from the Bank of England. Lending has rocketed ahead at more than 25% per annum over each of the last two years.

By Graham Parker | Updated on February 15, 2002

LONDON-New Bank of England data shows that loans outstanding to property companies stood at £71.3 billion ($100 billion) at the end of 2001. The figure increased by 5.7% in the fourth quarter of the year, taking the increase on the whole of 2001 to 25%. This comes on top of a 26% increase the previous year.

Debt outstanding to property companies now amounts to 11.5% of all commercial lending, up from 9.9% at the end of 2000 to at the end of last year. The last time lending reached this level was in 1992 when the Bank of England was issuing increasingly strident warnings that such an exposure to property was putting banks at risk.

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