Last week, the Prudential Regulatory Authority (PRA)imposed new demands on banks and building societies, insisting that they hold more capital on their books.

Experts explained that the two routes for meeting the new measure were to offload assets or reduce lending to households and businesses.

Nationwide and Barclays were named as two financial institutions which could be forced down these routes.

Both have bucked the trend in recent years by increasing their mortgage lending, which has been warmly welcomed by mortgage borrowers.

Barclays immediately announced that it would not struggle to raise the required capital by the PRA’s deadline.

And today, a Nationwide spokesman told Your Mortgage that it had no plans to reduce lending.

“We have put in a very strong record of lending over the last few years,” the mutual said.

“We are determined to continue to offer great deals to our borrowering members and customers and we will work with the PRA to make sure we will meet a 3% leverage ratio at a mutually agreed period of time.”