UK Lenders Predict Short-term Finance Demand in Early 2008
UK lenders are predicting an explosion in the number of businesses seeking short-term finance in early 2008 to escape their current banking facilities to seek a better deal elsewhere, according to analysis from Bridging Finance Limited. A triple whammy of the credit crunch, threat of UK recession and cautious lending criteria applied by banks is causing businesses to be more promiscuous with their banking arrangements. According to the Bank of England, business lending increased in the third quarter for both other financial corporations (OFCs) and non-financial corporations (NFCs). Lending to OFCs rose by £41.8bn in the quarter, including £27.7bn to other financial intermediaries and £11.2bn in business loans for fund management activities.