City watchdog asks banks how they will support mortgage borrowers

Talks held between FCA and lenders over concern millions could struggle to afford higher payments

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The City watchdog is asking banks how they plan to step in and support struggling mortgage borrowers, as lenders such as Virgin Money relaunch home loans at higher rates following a spate of withdrawals sparked by this week's market meltdown.

Supervisors at the Financial Conduct Authority (FCA) have been holding talks with lenders to understand how their mortgage customers are faring and the kind of options that are on the table that would give struggling homeowners some breathing space.