Thursday, 12 February 2009

credit starvation


It is strange fact, but despite the financial crisis, UK credit is growing at its fastest rate for a decade.

However, if credit to the shadow banking sector is excluded, the growth rate falls to around 4 percent. In the chart above, the shadow banking sector, takes the rather more obscure title of intermediate other financial institutions (OFCs). While the rest of the economy is starved of loans, the shadow banking sector has a seemingly insatiable appetite.

4 comments:

John said...

Are your lines the wrong way round? Otherwise it's the OFCs who are starved of credit...

Alice Cook said...

John,

Thanks for spotting that. I had mislabeled the lines. It is now corrected.

alice

Jelly bean said...

What exactly are these shadow banks. Excuse my ignorance, but it doesn sound a little shady.

mike said...

Jelly bean haven't you heard of wikipedia?

http://en.wikipedia.org/wiki/Shadow_banking_system