Funding for lending figures revealed for banks
Businesses and households have borrowed a net �500m in the first three months of a new Bank of England scheme designed to unclog the flow of credit in the UK.
A total of 35 lenders, including most of Britain's biggest banks, have signed up to the Bank's Funding for Lending scheme (FLS) and have drawn down �4.4bn between July and September.
The scheme was launched over the summer by the Bank and Treasury to offer lenders funding at low interest rates on condition it is passed on to households and businesses.
The figures showed that net lending by four major high street banks - Lloyds Banking Group, RBS, Santander and Co-op - had fallen in the three-month period.
But other banks, including Barclays, boosted net lending between July and September.
You may also want to watch:
A Barclays spokesman said: 'Despite the lack of economic confidence, Barclays responsibly increased net lending in Q3 by �3.8bn'.
RBS, which last week revealed it had loaned more than �20m to businesses in and around Norfolk, said it has used the FLS scheme to cut interest rates on small business lending by up to 1.7pc to as low as 3pc, as well as removing arrangement fees.
- 1 Two city businesses on the move as mystery new tenant hovers
- 2 Woman sexually assaulted in Norwich
- 3 Vision for multi-million pound new Norwich venue revealed
- 4 Norfolk-based Rick Wakeman 'stunned and proud' after being made a CBE
- 5 Norfolk cliffs fall man arrested on suspicion of murder released on bail
- 6 'People didn't know I existed' - Shopkeeper thrilled with new store
- 7 Scams in Norfolk this week: Hermes texts and electricity boxes
- 8 Ask the Expert: How much income will my £350,000 pension generate?
- 9 Family told baby with half a working heart has weeks to live
- 10 Be lord of the manor: Site of forgotten mansion for sale for £2.3m
A statement from the 80pc state-owned lender said: 'We will continue to offer these attractive rates to send a clear message that RBS is open for business.'
Fellow taxpayer-backed lender Lloyds Banking Group said it intends to apply to draw a further �2bn under the scheme, following an initial �1bn drawdown in September.
Lloyds chief executive Antonio Horta Osorio said: 'Lloyds was the first bank to access the Funding for Lending scheme and we have passed on the benefits of this lower funding in full, in particular focusing on first-time buyers and small businesses, where it will make the most economic impact.'
The Bank recently said the FLS is helping homeowners but is yet to have an impact on businesses.
The Bank said some business lenders were still 'tightening terms' despite the launch of the scheme and it has had 'a more immediate impact' on the availability of mortgage approvals.
Meanwhile, Santander corporate and commercial banking said support from the Government's Funding for Lending initiative has helped it increase lending to small and medium-sized firms in the Anglia region by 10pc over the past year.
In total, SMEs in the region received �86m of new funding from the bank during the year to the end of September.
Economic Secretary to the Treasury Sajid Javid said: 'It's still early in the life of the scheme, but Funding for Lending has already helped to deliver half a billion in loans for households and businesses. Though it will take time to fully feed through, today's positive data shows participating banks are increasing their lending.'