Small Business Lending Targets Missed by Banks
Lending by banks to Small and Medium Enterprises (SME’s) as part of the Government’s Project Merlin fell short of targets in 2011.
As part of the Project Merlin agreement, Barclays, Lloyds Banking Group, the Royal Bank of Scotland, HSBC, and, in the context of lending, Santander, “stated a capacity and willingness” to lend £190 billion of new credit to business in 2011, with £76 billion earmarked for SMEs.
However, new data released by the Bank of England reveals that £74.9 billion was extended to SMEs in 2011 representing a £1.1 billion shortfall.
After taking loan repayments into account, the five – Lloyds Banking Group, Royal Bank of Scotland, Santander, Barclays and HSBC – saw combined net lending slide in 2011, the Bank of England said, including a 3 per cent drop in the final quarter.