RBS and Lloyds retreat from London mortgages amid bubble fears

Britain's two state-backed banks have retreated from lending to the London property market since the financial crisis, in a sign of caution amid fears of an inflating housing bubble.

Lloyds Banking Group has more than halved its share of London lending - from 31% to 16% - since 2008, according to figures obtained by the Financial Times. Royal Bank of Scotland has also reduced its exposure to the capital, although less dramatically. London mortgages accounted for 13% of RBS's lending in 2013, compared with almost 16% in 2008, when values were substantially lower. After several months of booming house price growth in London, concerns are mounting that borrowers are overstretching their finances to afford homes. Nevertheless, a number of lenders are still pilin...