Chancellor George Osborne and Business Secretary Vince Cable met with banking chief executives to discuss future lending. Once the 90 minute meeting concluded all agreed that lending up to the economic crisis should have been more diversified. Nearly three-quarters of all lending prior to the crisis went to property loans. Now lenders are going to seek to do more for businesses in the UK than they have been.
Mr. Cable stressed in his speech to the executives that if more was not done to make increased lending available to small and medium sized businesses that it would “seriously contain” British recovery.
While lenders are going to ensure businesses requiring bank credit get what they need, politicians are going to do their part by withholding new regulations against higher capital requirements making it more difficult for banks to lend.
In a joint statement given by Osborne and Cable: “We met the CEOs of the UK’s largest banks as part of on going discussions on regulatory reform, and the availability of credit. It was a very constructive meeting that will help inform the Government’s Green Paper on business finance which will be published shortly.”
It is planned that this type of meeting will continue on a regular basis between top bank execs and senior politicians to discuss and review the health of the banking industry.