Banking results season kicks off this week
British banks will unveil their first-half profits this week with the five biggest banks expected to reveal they are back in the black.
Banking giant HSBC will kick off the reporting season tomorrow, with Lloyds Banking Group and Standard Chartered announcing their results on Wednesday, Barclays on Thursday and Royal Bank of Scotland (RBS) on Friday.
They are expected to report combined first-half profits of around £8.4 billion and with this in mind, Chancellor George Osborne said it is now their “obligation” to boost lending as they return to profitability.
In an interview with The Sunday Telegraph, Mr Osborne said they have an “economic obligation” to lend.
“Every small and medium-sized company that I have visited in recent weeks has had some problem with their bank – either they have found it difficult to renew their overdraft or they demanded additional collateral, often someone’s house,” he said.
“The danger is that, particularly next year, when there is a huge amount of refinancing required, that the small and medium-sized businesses suffer from a lack of access to working capital.”
In response to the Chancellor’s warning, the British Bankers’ Association (BBA) said the industry acknowledged its responsibility.
In a statement, BBA chief executive Angela Knight said: “Banks are well aware of their responsibility to society and our commitment to support the economy by lending to individuals and firms.”
However, the controversial subject of bankers’ bonuses continues to surround the industry and the Centre for Economics and Business Research said City workers were awarded £6 billion in bonuses in last year and are on track to receive £6.8 billion this year.
It has previously been announced that the Government is considering a levy on excessive profits and remuneration, and recently, Mr Osborne said he will “demand further restraint on pay and bonuses”.