Barclays to boost lending by £11bn
In contrast to the Chancellor’s Budget speech yesterday, Barclays believe the recession will be long and deep but the bank has vowed to help businesses and households by increasing lending by £11bn in 2009.
Alistair Darling said in his Budget yesterday that the British economy will see recovery by the end of the year with a positive statement that 2010 will yield a 1.25 percent growth.
John Varley, Barclays chief executive, has backed the International Monetary Fund’s view that over 2010, UK GDP will reduce by 0.4 percent and that the slowdown will continue for at least another year.
Even though Barclays has boycotted the Government’s Asset Protection Scheme, the bank joins the Royal Bank of Scotland and Lloyds Banking Group in increasing lending and follows the news that Northern Rock said that mortgage lending will reach £15bn over the next 2 years.
The £11bn is spread across 2009 with £5.5bn set aside for personal customers and £5.5bn for business clients and the increase is 6 percent on previous levels of lending.
This increase is going to please the Government who have placed pressure on the banks to increase lending even though Barclay’ has not received any taxpayer money.