Will UK banks need further bailout funds?
While we saw the UK banking sector literary teetering on the brink of collapse only a few months ago, it would appear that despite progress over the last few months there is still a long way to go and the sector is in no way out of the woods yet. The situation regarding Lloyds bank and Royal Bank of Scotland, both of which are under investigation by the EU and looking to raise additional funds, is a perfect reflection of the fact there is work to be done and it needs to be done quickly.
The UK government has already ploughed billions upon billions of pounds of UK taxpayers money into the sector, and despite promises of delivering investment returns in the short to medium term, there is no certainty on this particular issue. Unless UK banks increase their liquidity in the UK commercial market there is a chance we could see the economy slip back into recession and all the good work done over the last 12 months may be lost forever.
If UK banks do need financial assistance in the short to medium term there are serious concerns that the UK government does not have the funding available which will cause something of a stir to say the least.
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