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You Can Bank on us to Lend

Martin Racher, Area Director Commercial BankingBristol & Somerset

Headlines, Myths and Facts?

‘Working capital fears in recession’‘Overdrafts declining’

‘Banks just aren’t lending’‘Banks aren’t usinggovernment schemes’

Is Lloyds TSB Lending to SMEs?• Net Lending to SMEs went up by 2.1% in 2010

• £11bn Lent to SMEs in 2010

• 8 Out of 10 Requests are Agreed

• Our Local Managers Can Make Decisions of up to £500K

• Less Than 60% of Overdrafts are Being Drawn Upon

• Requests from Customers have fallen

What Has Changed?

• Some Lenders have Withdrawn from the Market

• Customer Confidence is Lower

• Customers have paid down debt

• Increased Regulation

• LTSB Lending Policy has only Changed Slightly

• A Consistent Approach

• Quick Decisions

• Local Decision Making

• Transparent Pricing

• Ongoing Advice and Relationship

What Do Customers Tell Us They Want?

What Does The Bank Look For?

• A Viable Business Proposition• Proven Track Record • Evidence of Ability to Repay• Tangible Security / Cash Stake if Available• A Full Banking Relationship

Who Can Help Banks To Lend More?

• Politicians• Lobby Groups• Local Influencers• Professional Advisors• SME Owners• And, of course, the Banks Themselves

Is it a Good Time to Borrow?

• Borrowing Costs are Half that of 2007• 8 Out of 10 Requests Agreed• EFG Scheme Available• Many New Start Ups• Acquisition and Expansion Opportunities• Dangers of Running Down Cash Reserves • We Need it to be!

So, What Should SMEs Do?

• Please Ask!