A bank in Singapore has become the first in the world to suspend loans for the purchase of homes in London, citing uncertainty over the UK’s vote to leave the EU. United Overseas Bank (UOB) said: 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”. It added that it would keep the suspension under review.
There have been London properties available for the last few months before the Brexit. The question is whether these properties can still continue to receive buyers in the short-term.
Alice Tan, head of consultancy and research at Knight Frank Singapore
The announcement reflects not just the meltdown on financial markets in the wake of last week’s vote - but also wider concerns for the health of the global economy, with Asia firmly in focus. While Singapore’s third-largest lender is the only major financial institution to place its London home loan programme on hold, others have expressed concern about exposure to the UK’s prime property market. Singapore’s biggest lender, DBS Group Holdings, said it was advising customers to be cautious amid “potential foreign exchange and sovereign risks”.