The housing market will not see a return to the profligate mortgage lending practices of the past few years, the governor of the Bank of England insisted on Monday as he announced a massive operation to support liquidity in British banks.

Making an almost unlimited offer to acquire UK banks’ mortgage-backed securities for up to three years in return for Treasury bills, Mervyn King said the plan would “take the liquidity issue off the table in a decisive way”. But he warned that the objective of the plan was neither to persuade banks to start lending again nor stand in the way of a housing market correction.