Mortgage holders ‘unlikely to get much support’ from meeting Government urgently called with bank chiefs
MORTGAGE holders are unlikely to get much support today from a meeting the Government has urgently called with bank chiefs on the repayments time-bomb, sources say.
Chancellor Jeremy Hunt and Treasury staff will grill high street lenders on what they can do to help homeowners as the cost-of-living crisis continues to bite.
It comes after the Bank of England hiked interest rates by a bigger-than-expected 0.5 per cent to 5 per cent as it bids to tame runaway inflation.
The 13th rate rise in a row will see a sharp jump in repayments for 1.4million mortgage holders who renew this year.
The average two-year £200,000 mortgage rate has jumped to 6.33 per cent — £1,239 a month and £450 more than when the rate was at 2.25 per cent in 2021.
Many will see a fifth of their pay go on the mortgage.
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PM Rishi Sunak has already ruled out major financial aid amid fears that such a move will fuel inflation further.
Instead, lenders are being grilled on how they can help — although it is thought they will rail against demands to standardise mortgage holidays, a policy during the pandemic’s extremes.
Bosses will instead turn to existing measures, such as extending mortgage terms.
NatWest said that it already offers struggling customers interest-only options — including reduced or zero mortgage payments for a set period.
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HSBC also said it was calling customers who have rolled on to a high standard variable rate (SVR) — now almost 8 per cent — to invite them to explore other options.
Skipton Building Society added: “We’re here to support members with temporary and longer term measures to support affordable repayments such as changing the loan to interest-only, extending it to reduce payments, maintaining a lower SVR, temporary payment holidays and agreed temporary reduced payments.”
One industry source said the meeting between the Treasury and banks was a “clear example of just wanting to be seeing to be doing something when a lot of the things they’re asking for are already being done.”
TESCO NO 'GREED'
THE CEO of Tesco has hit back against claims of “greedflation” by supermarkets.
Ken Murphy said the retailers had thin margins and were cutting prices for shoppers as their own costs fell.
He told The Times’ CEO Summit: “Grocery retail has operating margins of 3p to 4p in the pound, so it can hardly be described as flagrant greedflation.”
Industry figures from Kantar showed that food inflation fell from 17.2 per cent to 16.5 per cent in the four weeks to mid-June.
GRAPE EXPECTATIONS
ENGLISH vineyards are toasting their recent sparkling success with plans to double wine production within the next decade.
Wine is one of the fastest growing agricultural sectors in Britain — with 12.2 million bottles produced last year.
New figures from WineGB revealed that the producers now have 4,000 hectares of vineyards and are predicted to make between 25 and 29 million bottles by 2032.
Two-thirds produced by British vineyards, such as Chapel Down, Rathfinny and Bolney Estate, is sparkling — while a third is still wine.
Holy smokeless
THE Church of England is dumping its £7million investments in oil and gas companies including Shell and BP, saying the firms had failed to address climate risks.
The Church said last month it was prepared to vote against Shell’s new boss Wael Sawan for backtracking on green targets. “Some progress has been made, but not enough,” Justin Welby, Archbishop of Canterbury, said.
The Church said it would also make “robust commitments” on energy from other companies it was invested in.
OCADO IN JUMP ‘ON TAKEOVER’
SHARES in Ocado leapt 40 per cent after speculation that the online grocer was a takeover target.
The Times suggested Amazon or another US tech player might table an 800p bid — prompting shares to hit 631p.
Industry experts thought the sudden rise in share price would force the Takeover Panel to get Ocado or Amazon to make a statement if there were any live discussions.
But no statement was made to the stock exchange and both sides declined to comment.
A deal with Amazon has been a long-running rumour as the tech giant sets its sights on the grocery market.
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Despite taking over Whole Foods, opening cashierless Fresh stores, and launching free food deliveries for Prime subscribers, Amazon has yet to crack the food market.
Ocado shares have fallen about 40 per cent in the past year as its online sales boom during lockdowns tailed off.
ROOM IN INN HIKE
PREMIER INN has hiked room rates 16 per cent to an average £78 for its guests.
The budget hotel chain’s owner Whitbread revealed in its set of results that revenue per room is 40 per cent higher than it was before Covid.
This helped Whitbread’s UK sales rise 18 per cent in the past 13 weeks.
Despite the cost of living crisis, the company said it was confident in its outlook as London is seeing a bounceback in demand.