The head economist from Lloyds TSB has commented on the unchanged base rate announced today, explaining that it was the need to keep a lid on inflation that led to the decision.
Although there is still a real threat of further economic slowdown the Bank of England could not afford to cut the base rate again since the underlying rate of inflation is higher than it should be. As the Lloyds TSB pointed out, a further base rate cut could fuel more rises in inflation, completely the opposite of what is needed.
He went on to say that, as far as Lloyds TSB can see there will need to be more indications that the economy really is in a slowdown mode before base rates can be considered for reduction again.
Although the general feeling may be that UK banks are currently taking a beating an investment expert has suggested Lloyds TSB makes a great investment opportunity right now.
The analyst felt that in the midst of what have been torrid trading conditions Lloyds TSB had announced very encouraging results. The bank has taken a cautious stance on mortgages, buy to let ones especially, and also any securities that are underwritten by assets.
This approach has kept Lloyds TSB away from the worst of the difficulties facing some other banks and left them looking strong as they move forwards. The bank appears to be a relatively safe haven with the cautious management approach but also offers the opportunity for substantial growth as Lloyds TSB uses its relative strength to maximise market opportunities.
A new five year contract has been agreed between the Alliance and Leicester and Payzone, a 17,000 site network where consumers can pay water bills.
Estimated figures for the year are that around 6 million transactions will be processed by the Alliance and Leicester on behalf of Payzone, consumers using either a booklet or credit card style payment card. The relationship between the two companies began in 2007 so this five year deal shows the belief they have in each other now.
The commercial side of Alliance and Leicester works with around 1,500 businesses to collect payments from consumers, with most utility companies signed up as well as 8 out of 10 local authorities.
