Banks boost small firm lending
Jun 10 2009
High street banks increased their lending to small businesses by £287 million in April, the British Bankers' Association (BBA) reveals.
Figures from the group show that loans made up £267 million of the total, with the remaining £20 million being provided by small firms' overdrafts.
The findings follow March's net increase of £271 million in lending, which saw £277 million issued in loans but overdrafts decrease by £6 million.
In addition, the BBA shows that small companies increased their deposits by £119 million in May, after a boost of £881 million in the previous month.
Meanwhile, 48,397 new banking relationships were formed with small business customers.
David Dooks, BBA statistics director, comments: 'The high street banks' support for the small business sector continues to rise. The net increase of £287 million in April's lending was consistent with the trend in recent months.'
Last month, the organisation claimed that UK banks will lead the country out of the recession through working closely with customers, businesses and the government.
However, speaking at yesterday's Association of British Insurers conference, deputy governor of the Bank of England Paul Tucker said that it will not be clear if lenders have made any progress in supporting economic recovery until later in the year.
He also claimed that lending remains subdued and warned banks not to hoard funds in order to sit out the recession.
Figures from the group show that loans made up £267 million of the total, with the remaining £20 million being provided by small firms' overdrafts.
The findings follow March's net increase of £271 million in lending, which saw £277 million issued in loans but overdrafts decrease by £6 million.
In addition, the BBA shows that small companies increased their deposits by £119 million in May, after a boost of £881 million in the previous month.
Meanwhile, 48,397 new banking relationships were formed with small business customers.
David Dooks, BBA statistics director, comments: 'The high street banks' support for the small business sector continues to rise. The net increase of £287 million in April's lending was consistent with the trend in recent months.'
Last month, the organisation claimed that UK banks will lead the country out of the recession through working closely with customers, businesses and the government.
However, speaking at yesterday's Association of British Insurers conference, deputy governor of the Bank of England Paul Tucker said that it will not be clear if lenders have made any progress in supporting economic recovery until later in the year.
He also claimed that lending remains subdued and warned banks not to hoard funds in order to sit out the recession.
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