UK Banks are engaging in a stampede to pay down debt and off load non-performing loans in the run up to tougher rules on capital adequacy. This month Lloyds Banking Group announced it had sold £809 million of Australian real estate debt for a mere £388 million. The proceeds will be used to pay down debt. The Lloyds deal follows on from similarly discounted sales by RBS and others who are keen to reduce their exposure to commercial bricks and mortar. As the Banks concentrate on selling off assets and paying down debt the chances of them freeing up more cash for the UK residential mortgage market seem slim to say the least.