Singapore bank’s move to halt London lending badged ‘knee-jerk’ decision

UOB gave a statement to the BBC which said it would halt lending due to global market turbulence caused by the Leave vote.

Its statement read: “We will temporarily stop receiving foreign property loan applications for London properties.

“As the aftermath of the UK referendum is still unfolding and given the uncertainties, we need to ensure our customers are cautious with their London property investments.”

Ian Gray of Kinnison Private Finance said: “This is a knee-jerk decision. It is having a severe reaction due to press reports outside this country.

“The problem for UOB is that it is sitting in Singapore, with no one on the ground in the UK. It doesn’t know the UK property and mortgage market as well as the people here. Also, it only lends in zones one to four and only offers buy to let, so it has a niche offering.  It also fears the weak pound will affect investors.

“This reaction is not because they think we are about to have a property crash. It’s more to do with foreign exchange,” he concluded.