A trading book includes loans banks have earmarked for sale and are thus marked-to-market, while a banking book is where a lender holds loans and other assets not intended for disposal. This implies a heavy discount of 15 pence on the pound if banks sell the loans at that level. Banks make money also by charging the borrower a fee to provide loans, then sell the loans to third party investors. Reuters could not ascertain the exact size of the hit on the loans sold. On the flipside, loans sold by banks can generate attractive gains for buyers.

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