The Bank of England on Monday announced a $100 billion plan to allow banks to swap mortgage-backed securities for Treasury bills. The bank's aim is to unblock the interbank lending market, by giving banks assets they can use to operate, in hopes they will then resume lending more — and support the housing market and the overall British economy. Banks have become increasingly reluctant to lend to rivals in the wake of the global credit crunch. The bank is offering the asset swaps for one year, but they will be renewable for up to three years. Only assets that existed at the end of last year will be eligible, the central bank said.

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