Rate of household and business loan defaults slows
The rate at which households and businesses defaulted on loans has been lower than expected in the first three months of this year, according to the Bank of England.
The Bank’s credit conditions survey for the first quarter of 2010 found that lenders reported that defaults on unsecured lending to households had fallen markedly over the past three months and by more than had been expected. Moreover, lenders expect that trend to continue over the coming three months.
But losses given default – the amount of loss a bank sustains each time a person defaults – had risen over the past three months and that trend, too, is expected to continue.