Shaken by the never-ending saga around Brexit and the global slowdown, the British economy is now showing signs that point to an upcoming crisis. The U.K.’s biggest banks have been dealing with a growing number of loans companies are struggling to pay off. At the same time, low interest rates on mortgages are limiting opportunities for revenue growth.
Largest Lenders Write Off More Debt Than a Year Ago
The United Kingdom’s largest lenders have been writing off more loans than they were last year, another indication that many businesses are hurting in a deteriorating economic environment. In Q3 of 2019, writedowns on bad debt at four major British banks increased 51% from the same quarter of 2018, the Daily Mail reported quoting corporate figures.
The amount of nonperforming loans that have been written off by RBS, Lloyds, HSBC, and Barclays between July and September reached £1.76 billion (approx. $2.27 billion). During the same period last year it was around £1.17 billion ($1.51 billion), an analysis conducted by U.K.-based financial services company AJ Bell shows.
The difference of almost £600 billion has been attributed to the worsening economic conditions