Surge in consumer lending could prompt Bank of England intervention

Banks could be forced to strengthen capital positions after surge in loans to near-decade high triggers warning from debt charities

Lending to consumers has reached its highest level since before the banking crisis according to figures from the Bank of England, which will reveal on Tuesday if it is imposing restrictions on banks to cool down overheating parts of the economy.

According to the Bank, consumer lending increased at an annualised rate of 8.2% in October, the highest level since February 2006. A further category of loans and advances, which includes lending to buy new cars, jumped by 9.6%, the highest for 10 years.