TAPPING THE WORLD'S CAPITAL MARKETS
ONE FORECAST OF BUILDING societies' future wholesale funding
requirements suggests that, by 1990, their total worldwide capital
market borrowings will have increased tenfold to over 60 billion pounds.
It is an extreme forecast, based on assumptions of an annual
compounded growth rate of 15% over the next four years -- taking the
industry's total assets beyond 240 billion pounds -- and a rise
from 6% to 25% in the average level of their wholesale balances. Yet,
if past evidence provides any pointer to the future, it is the extreme
forecasts that come closest to the mark when attempting to chart the
societies' progress.
Five years ago, the societies were only just beginning to discuss
the possibility of supplementing their inflows of retail deposits by
tapping the wholesale money market. They were concerned about
maintaining their position as the primary source of home loans in the UK
in view...
