Oral question asked in the House of Commons, by Nick Palmer (Labour). It was answered on Tuesday, 28 April 2009 on behalf of the Treasury.

Lending to Business

Question: We also have the impression locally that the position is improving somewhat, but does the Chancellor agree that public support for the rescue of the banks is very much conditional on the banks' willingness to support the rest of the economy? Will he be doing all he can to ensure that our colleagues in the newly nationalised banks are aware of that public feeling?

Answer: I agree with my hon. Friend; the reason why we decided to intervene to restructure and rebuild the banking sector was the need to ensure that credit keeps flowing—that is vital for business. RBS will lend an additional £25 billion this year and next, the Lloyds group an additional £14 billion this year and next, and the figure for Northern Rock will be about £5 billion, which mainly relates to mortgages. Even the banks in which we do not have a stake have benefited from the support that we have given: HSBC has said that it will lend another £15 billion, while Barclays will lend another £11 billion this year. That money will be made available—although obviously it is important that we do everything that we can to ensure that credit keeps flowing—and will complement the measures that I announced in the Budget last week that are specifically designed to help businesses.

Secondary information