Government 'must consider capital issues' for competitive mortgage market

24 June 2010

Written by Steve Olejnik

Building societies will be more able to play a role in the recovery of the mortgage market if the government looks at capital issues regarding the sector.

That is according to the Council of Mortgages Lenders (CML), which in response to the Treasury's Building Society Capital and Related Issues paper claimed that the need for building societies to have capital is as important as regulation and funding.

The group believes that the business environment for mortgage lenders is currently stressed due to the number of companies, including one building society, which have failed as a result of the recession.

Michael Coogan, director general of the CML, said: "We believe more needs to be done to ensure the long term contribution of a thriving mutual sector to future competitiveness and growth in the UK retail markets."

The National Association of Estate Agents recently called on the government to make the lending criteria of mortgage providers more lenient to support the housing market

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