CITY DESK

More bad news for the UK's ailing housing market as the leading UK mortgage lender HBOS has announced today 425 job cuts and a scaling down of its TMB brand which provides finance for new builds and buy-to-lets.

The bank recently announced a drop in its profits of 72 per cent to £848m and a recent rights issue to investors proved to be a disaster as most investors did not buy extra shares.

With effect from late August HBOS will cease taking on new business from its TMB division and stop offering loans via its Intelligence Finance brand.  Existing customers with Halifax, Bank of Scotland and Birmingham Midshires, TMB and IF are unaffected.

The FT today reported that the UK mortgage market will shrink from £368bn in 2007 to £280bn this year because the "number of lenders who relied on securitisation have quit the market".

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