UK banks face £1bn millennium bill

UK banks have set aside more than £1bn to deal with the millennium bug according to the latest research. Barclays is leading the way with a budget of £250m, while at the other end of the spectrum Northern Rock is looking at a sum closer to £5m.

Mike Young, director at the British Banking Association (BBA), said: "£1bn is around the mark that we agreed on for banks. It's not easy to comment on an individual bank but on the whole they are moving forward."

According to the survey by City Consultants, a financial advisory firm, around 90 per cent of securities houses have a programme to deal with the problem but over two-thirds believe that some of their current systems would not meet Year 2000 requirements.

Young went on to explain that the BBA has already advised organisations that they need to by compliant by 31 December 1998, if not they could face serious consequences. He said: "From what we have deduced from our members, it suggests that everything will be on time."

Other big spenders are Lloyds TSB, NatWest and Standard Chartered, each bank having set aside £150m each. The survey showed that to date, only one-third of money set aside by UK banks has been spent.