Monday, 3 June 2013

Bailed Out Banks Cut Lending To Business

The Bank of England reported a £300m fall in total net lending by banks and building societies taking part in the Government's flagship Funding for Lending Scheme (FLS) in the first quarter, following a net decline of £2.4bn in the final three months of 2012 reports The Daily Telegraph.

RBS, which is 81pc owned by the taxpayer, cut lending by £1.6bn in the first quarter, while Lloyds, in which taxpayers have a 39pc stake, cut lending by £983m.

Santander, Britain's third biggest bank by deposits, cut net lending by £2.3bn. In total, the three lenders have tapped the Bank of England for £4.75bn since the launch of the scheme, but cut lending to the economy by £19.2bn over the same period.

All three banks shunned the FLS in the first quarter, despite a change to its terms in April that means high street lenders will be offered £10 of state-subsidised funding for every £1 they lend to small companies this year.

Come on Osborne and Cable - sort it out!

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