Bloomberg reported the Bank of England (BoE) as saying that it had extended its loan to its highest interest rate of 6.75%, without revealing the recipient. The publication added that Barclays had last borrowed from the BoE’s lending facility on August 20, 2007, when a loan from HSBC was delayed. As a result, Barclays was forced to borrow GBP314 million from the lender.
According to The Times, this time a system breakdown has forced the bank to borrow from the BoE. The publication stated that Barclays’s electronic settlement system’s interface experienced a technical glitch. When the problem was rectified an hour later, Barclays noticed a sterling shortfall.
Barclays has dismissed fears that it may be facing a financial meltdown, and as cited in The Guardian, said: There are no liquidity issues in the UK markets. Barclays itself is flush with liquidity. In these challenging times the dramatization of such situations is of no help to markets, their members or their customers.
