In a move which has surprised many in the financial sector, the Bank of England have had not one taker for their £10 billion fund to assist the sector through the credit crunch.  Does this mean that things may not be as bad as first thought, or are the institutions looking to hold out for as long as possible?

While there has been no real sign that the money markets are returning to normal, the fact that the £10 billion has not yet been touched is encouraging.  However, with problems in the US, a UK economy which is in danger of slowing down, and a property market which is unpredictable at best,  the signs are not good.  When you add to this the fact that the banks have recently been refusing some of the more risky transactions, it looks more like battening down the hatches for a rocky ride. 

In many ways it seems that the Bank of England are in a no win situation with criticism when they jumped in to bail out Northern Rock, and criticism because of the time they took to arrange the £10 billion funding arrangement - a fund which no one seems willing to utilise.  Quite what else they can do at this moment in time is not clear, but they will no doubt come in for more criticism in due course!

When you consider that the original credit crunch situation sprang up from no where, there are still a number of situations which could happen to heap yet more pressure onto the sector.   The financial industry may be able to see through the clear land, but it is still a long way out of the forest!