The number of small businesses asking the Financial Ombudsman Service to intervene in disputes over bank loan and overdraft facilities has jumped by a third in the last year, according to LDF, a leading finance provider.
Figures show that the number of complaints received by the FOS from small businesses about loans and overdrafts from banks increased from 612 in 2012 to 816 in 2013.*
LDF points out that the actual number of disputes between businesses and banks over their loan […]
FOS- SME Bank Loan Disputes Jump By A Third
Bankers’ bonuses – 100 times higher than public sector
Bankers’ bonuses were more than a hundred times higher than public sector workers over the past year and grew at double the rate of those of the average UK worker, official figures have showed.
The average bonus for bankers and insurance workers was £13,300 between May last year to April, while that of public sector workers such as nurses and teachers was the lowest at around £100 on average. The figures are likely to prompt further calls for stricter rules […]
Lawrence Tomlinson – Lloyds & RBS Should Boost Lending Or Be Broken Up
The government should use its stake in Lloyds Banking Group and the Royal Bank of Scotland to force them to lend more to firms, coalition adviser and multimillionaire businessman Lawrence Tomlinson has urged.
Speaking to the Huffington Post UK, care home mogul Tomlinson, who was drafted into the Department for Business as an “entrepreneur-in-residence”, said the two banks were “numb” to identifying what makes a business worth supporting.
“I think the two banks are too large to understand the difference between good and bad businesses, […]
Banking sector slow to increase competition after new rules
A relaxation in the rules governing the creation of new banks is yet to lead to a dramatic increase in the number of new high street players being authorised by the City regulator.
Figures published by the Bank of England show little change in the annual approval rate for new banks since the introduction of rules last year, which mean that new banks need less capital to get started than they did in the past.
Five banks were authorised in the […]
George Osborne at Mansion House: Muddled, Boastful and Upstaged
The chancellor offered only contradictions as he followed the Bank of England governor, Mark Carney.
When the chancellor of the exchequer made his annual speech at the lord mayor’s Mansion House dinner on Thursday evening, George Osborne was more than a little upstaged. The Bank of England governor, Mark Carney, had just given a dense and well-delivered speech, which included a surprise announcement about interest rates. Osborne’s address was the economics equivalent of Joe Pasquale taking the stage after Bill […]
Sir Richard Lambert launches UK banking standards council
By Sharlene Goff, FT Retail Banking Correspondent
A new organisation charged with raising standards in the banking industry will rely on public naming and shaming of lenders that fall short as it attempts to clean up the sector after a series of misconduct scandals.
The UK’s seven largest lenders have agreed to report each year to the new Banking Standards Review Council. The body will set standards for “culture, competence and customer outcomes” and publish an annual report detailing where banks […]
Tomlinson – Government influenced by lobbyists came as a real shock to me.
There is a “revolving door” between the civil service and the lobbying industry, Lawrence Tomlinson said.
Lobbyists for the banking industry have become “indispensable” to ministers because they fund programmes and the control information on which civil servants depend.
David Cameron once described lobbying as the “next big scandal waiting to happen”.
Mr Tomlinson made an estimated £550 million fortune investing in care homes, construction, IT and sports cars.
He spent a year as the Business Department’s “entrepreneur in residence”, advising Vince Cable, […]
Budget Report: ‘Access to finance remains a problem for SMEs’
In its report into the 2014 Budget, the Treasury Committee has reiterated the difficulties SMEs face when seeking finance – something which is preventing some businesses from reaching their full potential and hindering the economy.
Robert Wood, Chief UK Economist at Berenberg Bank and witness for the Committee, said: “very poor availability of finance over the past few years has almost certainly prevented some rapidly growing firms from expanding.”
It’s a view shared by fellow witness, the Confederation of British Industry […]
Can banking clean up its act? A speech by Lionel Barber
A speech by Lionel Barber, Financial Times editor, at Hughes Hall, University of Cambridge, May 1, 2014. An accompanying video can be viewed here.
Ladies and gentlemen, distinguished guests, I am delighted to be here tonight at Hughes Hall in the University of Cambridge. This is the prestigious City lecture, but sadly I will not be providing slides. As Lord Acton might have said, power tends to corrupt, PowerPoint corrupts absolutely.
Tonight I want to talk about bankers and banking. These days, bankers are […]
65% of SME’s rejected for a loan want to try alternatives
A government consultation ended last week into whether legislation should force banks to refer rejected loans to alternative sources of finance.
At present the largest four banks account for over 80% of UK SMEs’ main banking relationships. Many SMEs only approach the largest banks when seeking finance. Although a large number of these applications are rejected – in the case of first time SME borrowers the rejection rate is around 50% – a proportion of these are viable and are rejected simply because they don’t meet […]
Vince Cable – Bankers’ Pay Still Extraordinarily Large
Vince Cable has issued a stark warning to Britain’s leading boardrooms that they need to crack down on bonuses to restore public trust and avert the threat of fresh legislation to limit executive pay.
The business secretary fired off a warning to the 100 biggest UK-listed companies about the damage big pay deals can have on their image, before Barclays’ annual meeting on Thursday, where protests about the bank’s £2.4bn bonus pot are expected to be registered by disgruntled shareholders.
Cable told […]
New crowdfunding rules: implications for small businesses
SMEs are increasingly looking at crowdfunding as a way of raising finance without dealing with bureaucratic banks and fickle investors. However, new rules by the Financial Conduct Authority (FCA), which came into force recently, regulate certain types of crowdfunding.
Crowdfunding involves raising finance by taking small investments, loans or donations from a large number of people. Depending on who you believe, the new FCA rules have either “taken the crowd out of crowdfunding” or “represent the right balance between the freedom […]
FCA Reports Surge in Useful Tips From Whistleblowers
The figure provides a boost for the regulator, which last year came under fire from a report by the Parliamentary Commission on Banking Standards that criticized the FCA’s handling of whistleblowing. The report said the commission had received evidence from whistleblowers that “demonstrated a lack of confidence in the regulator’s willingness and ability to support them and to act upon their concerns.”
The report made a number of recommendations, including that the FCA provide feedback to whistleblowers—a policy that the […]
FSB – Only 37% of SMEs Aware of Funding Alternatives
A recent survey from the Federation of Small Businesses found that just 37% of SMEs knew about them.
When Simeon Penn, director of powerboat experience company Saber Powersports, needed a loan for a new boat, he didn’t go to his bank. Instead, he got the money from Funding Circle, an online marketplace that allows individual savers to lend money directly to small and medium-sized businesses (SMEs).
Mr Penn’s accountant suggested he try this alternative form of funding after the bank failed […]
Co-op Bank Confirms losses of £1.3bn
The Co-op Bank has confirmed it made a loss of £1.3bn last year and will remain loss-making for the next two years as the troubled lender published its twice delayed annual results.
The lender said it had begun talks on a £400m fund raising and warned that without the new money it would be in breach of its minimum capital requirement.
Niall Booker, chief executive of the Co-op Bank, apologised for the situation and said the lender would be clawing back […]
Asset Based Lending extension for SME manufacturers
Small and medium sized manufacturing businesses will be able to use their assets to borrow cash thanks to a newly created team at RBS and NatWest.
Asset based lending (ABL) is a well established funding mechanism which allows companies to borrow money against its assets including existing stock and equipment.
The newly established team includes 11 specialist finance managers who facilitate deals across the UK – specifically for businesses with a turn over of between £10 million and £25 million.
Although RBS […]
Alternative Funding Grows as 35pc of SME Bank Loan Applications Fail
Amid a soaring failure rate for bank loan applications, small firms are looking to alternative finance providers for growth capital. Entrepreneurs share their experiences.
The local bank was once the first port of call for a growing business seeking finance. Today, however, , according to the latest SME Finance Monitor from BDRC Continental. And recent Bank of England lending figures showed a drop of £300m in small business lending in January this year.
Against this backdrop, a raft of alternative funding […]
Federation of Small Businesses Chief on Scandal Hitting Bank SME Lending
The Federation of Small Businesses and the British Chambers of Commerce have teamed up to investigate the state of the banking industry’s lending practices and small to medium enterprises.
The Business Banking Insight programme (BBI) will ask micro companies and SMEs to share their experiences to provide insight into the best banking services available across the UK. The first set of results will be published in May.
Speaking to IBTimes UK, FSB’s National Policy chairman Mike Cherry reveals how a lot […]
Lloyds to lend an extra £1bn to SMEs
The bank’s promise over the coming year plays its part to revive one of the key elements of the UK economy
Lloyds will pledge to lend an extra £1bn to small and medium-sized businesses over the coming year as it plays its part to revive one of the key elements of the UK economy.
The bank’s promise follows recent Bank of England lending figures which showed a drop of £300m in loans to small businesses in January this year.
The commitment forms […]
Banking standards body must be run by non-bankers, says review chief
The former director general of the Confederation of British Industry (CBI) has said that the authority on banking standards should not consist of bankers.
As part of his Banking Standards Review, Sir Richard Lambert said the group should not act as a platform for bankers to lobby government and help shape policy.
Instead, he is recommending that members be recruited from outside the banking industry in order to secure its credibility and independence.
The review was launched at the request of the […]
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