Banks agree to fund Tube line to Docklands

THE pounds 1.7bn project to extend the Jubilee underground line to the London Docklands looks like being saved, writes Jason Nisse. The Government has been offered the deal it wanted by bankers.

Six of the 11 banks that lent more than pounds 600m to the failed Canary Wharf project agreed yesterday to provide pounds 400m towards the cost of the extension.

The Department of Transport is not expected to make a statement before the Chancellor's Autumn Statement. However, Steven Norris, the minister for transport in London, said this week that he was keen for the Jubilee Line project to go ahead.

London Underground, which has committed pounds 200m to the project, estimates it would create 12,000 jobs. Work can start within a month of any government agreement. London Underground would move its engineering department, employing 2,000 people, to Canary Wharf if the line was built.

The banks - Barclays, Lloyds, Credit Lyonnais, Credit Suisse, Commerzbank and Kansallis-Osake-Pankki - agreed to provide pounds 100m immediately and pounds 300m over 30 years, as originally offered by Canary Wharf's developers, Olympia & York.

The banking consortium had previously made the contribution conditional on 2,500 civil servants being moved to Canary Wharf.

The extra money will increase the banks' exposure to Canary Wharf and they will take extra charges over properties there.