British Banks May Need More State Funds: Think Tank

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British banks may require further taxpayer funds, with borrowing needs potentially hitting £25 billion pounds ($39.5 billion) a month, according to a think-tank.

The independent New Economics Foundation said that central bank data indicated the banks are facing major funding problems, Reuters reported.

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Finance Minister George Osborne dismissed the suggestion.

"I am certainly not expecting and I have no indication at all that any British bank needs any further support," Osborne said.

British banks Royal Bank of Scotland (RBS) and Lloyds (LYG) had to be partly nationalized during the financial crisis, while others such as Barclays Bank (BSC) and HSBC (HBC) were able to take advantage of cheap central bank credit.

British banks have until January 2012 to pay back £185 billion they owe to the Bank of England. They borrowed the funds against £287 billion of illiquid assets, mostly residential mortgage backed securities.

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