Former HBOS boss feeling positive

Published: April 22, 2008

A Bank of England package which could herald the return of sub-prime mortgages in the UK has been praised by a leading expert, who believes the outlook for the mortgage market is positive.

Sir Peter Burt, former deputy chairman of HBOS, has revealed that he is optimistic about the future following the Bank's announcement.

The Bank revealed that it has set up a Special Liquidity Scheme worth around £50 billion with the aim of freeing up the money markets.

This should then translate into more mortgages being made available and could lead to sub-prime mortgages once again being lent.

Sir Peter told BBC Radio Four's 'The World at One' that he is confident things are heading in the right direction.

"I am very optimistic because the Bank of England has said that if £50 billion is not enough, they will put more in," he explained.

"I think from that point of view there will be an increasing volume of money and the liquidity should start tocease to be a problem," continued Sir Peter.

Governor of the Bank of England Mervyn King announced the Special Liquidity Scheme yesterday (April 21st).