Darling Wants More Bank Lending

Darling Wants More Bank Lending

Speaking on the BBC, Chancellor Alasdair has again pushed banks to lend more to smaller firms and is reported to have called in bank bosses one by one to apply pressure.

According to the Beeb, in the British Bankers Association’s latest figures, lending to smaller businesses was up by an additional £258m in June when compared to May.

We suggest this is nothing compared to the hundreds of billions lend top banks to keep the banking sector going.  

Mr Darling is said to be concerned at the lack of lending banks are now offering business, given their own funding, to assist through difficult times and is monitoring each bank on an individual basis.  With government support at £1.3 trillion and interest rates at only 0.5%, he is concerned as to why loan rates are getting more expensive.

We suggest this is an argument banks cannot win.  If they are cautious and do not lend money to ‘at risk’ businesses then they are actually doing what they should do which is sensible lending, if they do not lend money to ‘at risk’ businesses, they are damned by the people and government.  We suggest caution and to wean consumers and business off debt is a good thing.

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