Mandelson and Darling push bankers to lend
Bank chiefs met with the government’s economic team today as they faced strong calls to resume lending.
This afternoon, the first meeting of the Lending Panel saw Alistair Darling and Peter Mandelson meet with top level representatives of banks, the Bank of England and consumer groups over how to get banks and building societies lending again.
The Lending Panel was announced in the Pre-Budget report by the chancellor “to monitor lending levels and practices by banks”.
“I’m prepared to do more to free up lending,” Mr Darling told MPs at the Treasury select committee yesterday.
“One of the reasons we established the Lending Panel. where I and Lord Mandelson will meet the chief executives of the biggest banks as well as Nationwide, is because we believe there is more the banks can do, particularly to small- and medium-sized enterprises.”
He added: “Banks have to understand we put very substantial sums of public money in to support them, and they in turn have to play their part.
“They have to go very much further in terms of supporting companies and individuals.
“There are a number of areas where they must go further in both lending to businesses and individuals.”
Mr Darling also did not rule out further support for banks if lending did not continue.
“We are looking at a range of measures to build on those announced in October – but there has to be quid pro quo on behalf of banks,” Mr Darling said.
However, the chancellor did rule out the government lending directly, saying it wasn’t his role to act as a bank manager.
The Lending Panel is expected to meet regularly and report to both Mr Darling and Lord Mandelson over problems in the lending market – highlighted by consumer and business groups – to discuss solutions.
