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Commercial Finance: News
31
Commercial market won’t improve Finance
without more access to funding guarantee
Stuart Parfitt, managing director England Credit Conditions Survey Treasury and the Bank of England
of Business Lending, has warned showed some improvement in is not using the quantitative easing
scheme
that it is still too early to call the overall credit availability this was programme more effectively to
bottom of the property market as mainly restricted to secured actually increase access to credit,
any real prospect of recovery household credit. Lending to small and not just lowering the cost of
falls short
remains dependent on realistic businesses and to the commercial capital to our already over
access to funding, which is real estate sector fell again and subsidised banks. Whilst their
The Enterprise Finance
currently not reaching the private lenders reported an expectation remit is slightly different, in
Guarantee scheme is still not
lending sector in any real volume. that it would continue to fall in Europe the EBRD regularly seeds
working for many small
He said: “Essential indicators the 3rd quarter also. investment funds with relatively
businesses according to the
show some improvement in the Stuart Parfitt continued: “There small amounts of money (£10-30
Finance & Leasing
commercial property market, but is an understandable risk aversion million), that have a swift, direct
Association (FLA).
these are mainly restricted to amongst the banks, especially and meaningful contribution to
Following a report by the
prime assets in the City & West those who over expanded at the economic stimulus. We have and
Business and Enterprise
End. There is little evidence that peak of the market, but the will continue to implore the Bank
Committee report on the
this is percolating out to the wider irrational exuberance of the to follow the lead of the EBRD
Enterprise Finance
market. Although tenant demand bubble years has turn to an with their inspirational investment
Guarantee scheme, Julian
appears to be stabilising there will irrational pessimism now the programme. A similar Bank of
Rose, head of asset finance at
be no meaningful improvement market has corrected and is at or England led programme designed
the Finance & Leasing
until there is an improvement in close to fair value. However I don’t to make access to funding easier
Association, said: "The
access to funding.” expect this to change. What I still would be a major step in
Enterprise Finance
Whilst the recent Bank of find hard to understand is that the reconstructing the UK economy.”
Guarantee scheme is still not
working for many small
businesses. If the scheme is
to make a significant
NACFB Patrons Day endorses call for SME funding
difference to businesses that
need the most help it must be
The continued call for greater shortage of funding to reach the Nikki Cann, Associate Director
extended to include asset
government intervention to ensure private sector for over a year now. of the NACFB, said “We were
finance. A third of small
funding finds its way to SMEs was The government seems happy to delighted with the attendance at
businesses rely on specialist
echoed by the many brokers ignore the real evidence and listen the NACFB Patrons Day and
lenders to provide asset
attending the NACFB Patrons Day to the assurances of the banks that the lenders who were there should
finance, such as hire
in London on the 1st July. they are lending again to the SME be applauded for supporting
purchase and leasing. Asset
Attended by approximately 120 sector, when clearly this is not the brokers at this difficult time, but
finance is an obvious option
NACFB members along with case. The members we talked to at clearly we are still a long way from
for the Enterprise Finance
patrons made up of lenders and the Patrons Day are in total seeing the funding tap being
Guarantee scheme because it
other product providers, the clear agreement that the industry should turned on for clients of our
is economical, flexible and
message that came across was the continue to press the Department members. At the NACFB, we are
offers certainty because
lack of funding being provided by for Business, Innovation & Skills going to do everything we can
finance is provided for a fixed
banks to the SME sector. and the Treasury to bring more to highlight the issues that affect
term.
Kevin Cooke, Director of pressure to bear on banks to our members to the government
"Small businesses are
Business Lending, commented “We increase lending in a meaningful and aim to help rectify this
increasingly concerned about
have been highlighting the acute way.” situation.”
cashflow, and demand for
access to credit for SMEs is
set to increase as firms are
Aviva launches commercial property cover
no longer able to survive
without new finance. Last
Aviva has launched its new factories, small warehouses and "Fast Trade provides brokers
year, asset finance provided
commercial property owners cover industrial units. with access to Aviva's commercial
750,000 SMEs with £15 billion
via its online trading platform, Andrew Green, product package range and enables them
of essential business
Fast Trade. development manager at Aviva, to transact business more easily,
equipment ranging from
The new offering, which is said: "This new package product with a quote and buy facility and
delivery vans to photocopiers.
traded exclusively online, is provides comprehensive cover for instant access to documentation."
Our economic recovery
packaged to target owners with property owners, whether they There are five additional
depends on schemes, such as
one to 10 commercial properties, have one or 10 properties. commercial packages available
the Enterprise Finance
with a building sums insured of Whatever the property is used for, via Fast Trade, which are Office
Guarantee, giving small
up to £2 million per property. The we've designed the cover to make and Surgery, Residential Property
businesses a range of finance
package provides preferential rates things easier for brokers and their Owners, Self-employed, Shop
options, including asset
for over 1,000 tenant trades customers, with the flexibility to and Salon, Pub, Restaurant and
finance."
including office blocks, shops, add on additional cover. Hotel.
www.mortgageintroducer.com September 2009 Mortgage Introducer
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