July 30, 2010

Vince Cable, the business secretary, whose declared ambition is to break up Britain's biggest banks, is trying to cajole these leviathans into lending more to growing companies. On July 26th his department published a paper with the Treasury called "Financing a Private-Sector Recovery". The villains of the piece, but also the potential heroes, are the banks, which are lending less and less to small businesses (see chart).

That is despite an agreement with Lloyds Banking Group and Royal Bank of Scotland (RBS), respectively 41pc and 68pc government-owned, that they will lend GBP94 billion between them to businesses of all sizes in the year to February 2011.



Original Posting At:   Economist