Downing Street Says

Put that the British Banking Association had put out a statement saying that they wanted to help but it was inevitable that businesses would go under, the PMS replied that it was clearly a challenging time for the economy, as the Prime Minister had been making clear yesterday. The banks themselves had committed to maintaining over the next few years, the availability and active marketing of competitively priced lending to homeowners and to small businesses at 2007 levels. The banks had entered into this commitment and we expected them to deliver on it.

Asked what the PMS was referring to when he said that the banks had entered into this commitment , the PMS said that he was referring to the statement that was made on the day the recapitalisation programme had been announced.

Asked what pressure the Government could put on the banks to make them deliver, the PMS said that we would continue to talk with the banks, and we expected the banks to talk with us, and small businesses, about the progress that they were making in regards to the commitments they had entered into.

Asked if the focus of the lending was now more about small businesses than mortgages, the PMS said no; the commitment was as set out in the statement that was made on the day of the recapitalisation programme, which explicitly referred to homeowners and small businesses.

Put that Ministers had been sidling away from too rigid an interpretation of that, the PMS said that he did not think anyone had been doing any such thing; it was clear that what we were talking about was the availability of lending. Individual lending decisions were for banks, but the commitment had been entered into and that was the commitment we expected to see delivered.

Put that Lord Mandelson had said in an article that he blamed the banks and the regulators for the current economic situation and asked if the Prime Minister thought that that was a fair assessment, the PMS said that he had not seen that particular article and before he commented on it he would like to see those words in their proper context. However, the Financial Services Authority had recognised that there were lessons to be learnt, particularly in relation to Northern Rock.

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» Thursday, October 23, 2008

Economy

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