Barclays Bank borrowed £1.6bn from the Bank of England on Wednesday.
It is the second time this month that the bank has tapped into the central bank's emergency credit line, sparking fears it is facing a cash crisis. On 20 August, Barclays was forced to take out a £314m loan from the Bank of England after HSBC was unable to process a last-minute request for the money.
Barclays explained that it was forced to tap into the Bank of England's emergency credit line because a technical glitch meant it discovered the shortfall in its finances too late in the day to borrow from another high street bank.
It added that the malfunction affected an electronic trading system on Wednesday afternoon, but the UK bank insisted it was “flush with liquidity”.
The Bank of England confirmed the loan was requested after the trading day had finished. (source)
This of course follows on from news that the Federal Reserve Bank in the US is bending the rules to bale big banks out of trouble, as we reported on Wednesday.
Are Gordon Brown's economic policies beginning to unravel, are the chickens about to roost.
NuLab – Destroying Britain from the inside out.