British lenders turn to Bank of England for extra cash injection
Britain's lenders have tapped the Bank of England for another £3.1 billion in extra cash to help bolster their balance sheets following the Brexit vote.
Lenders have now taken more than £9 billion from the Bank so far this month after it launched three additional so-called funding auctions surrounding the referendum vote.
It is the first time the Bank has ever held more than one such auction in a month.
Bank governor Mark Carney pledged on Friday to pump at least £250 billion into money markets if needed to prevent a credit squeeze.
But the result of the latest funding auction shows little sign of stress in the banking sector and is less than the £3.3 billion taken by lenders at the start of the month.
Banks in the UK already have a combined £600 billion in liquidity on their balance sheets, helping shield the sector from a repeat of the credit crunch seen at the height of the financial crisis.
Bank shares surged higher on Tuesday after two days of punishing declines amid a wider stock market fight back after the Brexit vote.
Lloyds Banking Group rose more than 5%, while Barclays and Royal Bank of Scotland lifted 3%.
But the trio have seen shares crash by up to 30% in the previous two trading sessions.
Connor Campbell, financial analyst at Spreadex, said: "The UK's banking sector is looking a bit rosier after having the colour completely drain from its face at the start of the week."