Going down: Bank of Scotland

THE BANK of Scotland was one of the biggest decliners in the FT- SE 100, falling nearly 9 per cent on the week. Other major banks, including Lloyds TSB and Alliance & Leicester, fell nearly as much as signs of rebounding economic growth sparked fears of an imminent rate rise. UK bonds posted their biggest losses in more than three weeks amid signs that inflation could rise faster than expected. This reduces the value of the portfolios held by banks and insurance groups.

The Bank of Scotland recently extended its direct mortgage operation to Ireland by offering home loans over the phone. It said this was the first step in a eurozone strategy for direct banking.