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Bank bosses downbeat on future

Two bank experts have issued gloomy forecasts for the mortgage sector over the months to come.Speaking to the BBC, deputy governor of the Bank of England Sir John Gieve said that he was "not sure" that the government would break even on its nationalisations of two lenders - Northern Rock and Bradford & Bingley.He said that this would be due to the high numbers of defaults on each mortgage firm's loan book.Meanwhile, the chief executive of Barclays told the broadcaster that he did not see a return to normal lending from UK banks for the foreseeable future.He commented: "I think that we will see the process of reduced borrowing play out over at least the course of the next 12 months maybe, maybe 24 months."[Credit available is] shrinking, it absolutely is, and that is a painful process; it's a process through which the world absolutely has to go."Mr Varley also predicted that conditions would only begin to normalise in about 18 months.

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