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News
05
Scotland's economy
faces a challenging
Growth will come
2009
back before 2010
The European Commission normal economic times so as to
The latest Lloyds TSB Scotland umes of repeat and new business. believes that GDP growth in the ensure the medium-to-long term
Business Monitor shows the The number of service firms expe- European Union is expected to sustainability of public finances,"
Scottish economy continuing to riencing a fall in turnover due to fall by 1.8 per cent in 2009 before said Joaquín Almunia, economic
struggle and facing a challenging the volume of repeat business was recovering moderately to 0.5 per and monetary affairs commis-
2009. almost four times the number cent in 2010. sioner.
This latest edition for the three who reported an increase giving a "The measures to stabilise the Economic growth is forecast to
months ending 30 November 2008 net balance of -31 per cent. New financial market, the easing of have dropped to about 1 per cent
shows 51 per cent of firms sur- business figures were poorer with monetary policies and the eco- in 2008 in both the EU and the
veyed reporting a decrease in a net balance of -38 per cent. nomic recovery plans will enable euro area, from just below 3 per
turnover, 29 per cent reporting Together with corresponding fig- us to put a floor under the deteri- cent in 2007, according to the
static turnover and 20 per cent ures from the production sector of oration of the economy this year EU’s advanced interim forecast.
reporting an increase, giving a net -20 per cent and -19 per cent and create the conditions for a In 2009, real GDP is expected to
balance of -31 per cent, down dra- respectively, these are the poorest gradual recovery in the second fall sharply, by 1.8 per cent in the
matically from the previous quar- results recorded in the history of part of 2009. The top priority is EU and 1.9 in the euro area,
ter's figure of -10 per cent and the Business Monitor. to make those measures work before recovering in 2010.
markedly different from the +16 Expectations of increasing effectively: to improve the flows Starting in the second half of
per cent recorded for the same turnover in the next six months of credit at reasonable prices and 2009, global growth is expected to
quarter one year ago. continue to slump. The overall to implement the fiscal stimulus rise gradually but moderately as
Once again services are affected balance for turnover for the next packages quickly to stimulate the financial market situation
more than manufacturing, with six months is -44 per cent, a dra- investment and private consump- improves and the impact of the
service businesses reporting a net matic decline from the +17 per tion. To boost confidence, it is macroeconomic policy easing
balance for turnover of -35 per cent of the same quarter one year also crucial that Member States (not least in the US) gains trac-
cent and production -23 per cent. ago. Expressing the depth of the explicitly commit that they will tion. Overall, global GDP growth
Both sectors are now experiencing fall in confidence, only 10 per cent reverse the deterioration of public is expected to be around 2.75 per
their worst result since the start of of service businesses expect finances as soon as we return to cent in 2010.
the Business Monitor. turnover to increase in the next six
Yet again the service sector is months compared to 60 per cent
experiencing a slump in the vol- who expect a decline.
NACFB appoints
BofE becomes commercial
Chairman
bank with £50 billion to invest
The National Association of from the initial ‘credit crunch',
Commercial Finance Brokers and now the impending recession,
The government has announced created in viable securitisation (NACFB) has appointed Philip has hit commercial finance bro-
that the Bank of England (BofE), structures. Hellawell, of Connect Business kers hard. It has never been so
will be creating a £50 billion fund The Treasury will authorise ini- Finance Ltd in Yorkshire, as important for the Association to
which will lend to the banking and tial purchases of up to £50 billion, Chairman for 2009/10. have a strong Board to help and
non banking sectors. Large compa- financed by the issue of Treasury Hellawell has been finance guide its members during this very
nies will able to raise cash in return bills. Given the scale of the pro- director of the Association for the difficult period."
for putting up assets as security. gramme, the Bank will be indemni- last three years and was Deputy Philip Hellawell said: "I have
As a further step to increase the fied by the Treasury. This Chairman during 2008. Following been a member of the NACFB for
availability of corporate credit, by programme will come into effect an election of directors at its AGM 13 years and have always admired
reducing the illiquidity of the from 2 February. The programme at the Celtic Manor Resort back in its aims and objectives. When I
underlying instruments, the Bank also provides a framework for the November, he was appointed as joined in 1996 I never imagined
of England will set up an asset pur- Monetary Policy Committee of the Chairman at the first Board meet- that one day I would become
chase programme implemented Bank of England to use asset pur- ing of the New Year. Chairman and I regard it as a great
through a specially created fund. chases for monetary policy purpos- Chief Executive, Adam Tyler, honour and privilege to be elected
The Bank will be authorised by the es should the MPC conclude that said: "I have worked with Philip as to this position for the next two
Treasury to purchase high quality this would be a useful additional the Association's Finance Director years. I am under no illusions that
private sector assets, including tool for meeting the inflation tar- for the last few years and am this will be a tough time but I am
paper issued under the CGS, cor- get. In such circumstances, the scale delighted that the Board has determined that we will get
porate bonds, commercial paper, of the scheme could be expanded, a decided to appoint him as Chair. through and it is my aim to hand
syndicated loans and a limited further announcement would be The NACFB is facing its most the Association over in good shape
range of asset backed securities made. challenging year ever as the impact at the end of my term."
www.mortgageintroducer.com February 2009 Commercial Finance Introducer
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