Alex Salmond calls on banks to increase lending

Published on Wednesday 19 May 2010 15:32

SCOTLAND'S First Minister Alex Salmond has called on financial institutions to lessen the tight conditions currently placed on lending to business.

The SNP leader, speaking at the National Economic Forum in Edinburgh, said the failure of banking to improve the way they lend to firms was a key barrier to economic growth.

He said the problem of securing credit has been highlighted at "every single economic meeting" he has attended in recent years.

Business leaders say the difficulty in securing loans after the multibillion-pound bailout of the banks two years ago has angered them.

The First Minister said: "Access to finance has been a key constraint for Scottish companies: it is a recurring theme from every business discussion.

"I think it is well understood that the transmission mechanism that the banks have set has to be made to work more effectively, and there's a range of proposals as to how that can come about.

"There's been some loosening of the credit and financial conditions of late but nonetheless it remains an abiding concern."

The taxpayer remains the majority shareholder in Royal Bank of Scotland and owns 43.5% of Lloyds.

A further 50 million being handed to the Scottish Investment Bank is among the Government measures that could help alleviate the situation, according to Mr Salmond.