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Lending to British business drops $7.6bn
April 19, 2013, 2:08 pm

[Getty Images]

Loans to businesses in Britain have declined 3.1 per cent year on year [Getty Images]

Lending to British businesses dropped nearly £5 billion (about $7.66 billion) in the three months to February, according to figures released by the central bank on Friday.

Data collected from all Britain-resident banks and building societies indicated that lending to British businesses in the December-February period decreased by £4.8 billion on the yearly basis, a fall of 4.4 per cent.

Month on month, the February figure is also £2.8 billion less than that of the previous month.

In the 12 months ending in February, loans to businesses declined 3.1 per cent year on year.

“The stock of lending to both small and medium-sized enterprises and large businesses contracted over this period”, said the Bank of England in its Trends in Lending report.

Loans to the real estate sector, which account for around 40 per cent of the total stock of business loans, have decreased since the second quarter last year.

Figures indicated that lending to the real estate fell by 5.3 per cent in December last year from a year earlier, the sharpest drop for more than three years.

The report found that some lenders expected lending to the real estate sector to be flat or contract slightly in 2013.

Source: Agencies

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