From Google: 2024-08-01 13:11:00

Britain’s biggest banks are facing a major slump in their stock prices following the Bank of England’s decision to cut interest rates to an all-time low of 0.1%. HSBC, Lloyds Banking Group, Barclays, and NatWest all saw their shares drop significantly in response to the news.

This move by the Bank of England marks the first time interest rates have been reduced in response to an economic shock since the financial crisis in 2009. The decision was made in an effort to bolster the economy in the wake of the coronavirus outbreak and subsequent economic downturn.

The decision to cut interest rates has sparked concerns about the impact it will have on banks’ profitability and ability to lend. Banks rely on the difference between the interest they charge on loans and the interest they pay on customer deposits to make money, and a lower interest rate could squeeze profit margins.

Investors are also worried about the potential for increased loan defaults and a slowdown in economic activity as a result of the interest rate cut. The move is seen as a signal of the challenges facing the UK economy and the banking sector in the months ahead.



Read more at Google: Britain’s biggest banks slump after interest rate cut – The Telegraph