British five major banks failed to fulfill their commitments for lending to small-and medium-sized enterprises (SMEs) in 2011, statistics of the country's central bank indicated on Monday.
According to the Bank of England, the five major banks, namely Barclays, HSBC, Lloyds Banking Group, RBS and Santander, delivered a total of 214.9 billion pounds to British companies under the Project Merlin they signed with the government in February 2011, of which 74.9 billion pounds were granted to SMEs, lower than their commitments of 76 billion pounds.
Under the agreement, the banks stated a capacity and willingness to lend 190 billion pounds of new credit to business in 2011. If demand exceeds this, the banks committed to lending more.
The figures confirmed an early survey report issued by the British Bankers' Association (BBA).
The central bank figure shows that quarter-on-quarter net lending for enterprises dropped last year, respectively at 2.8 percent, 3.7 percent, 0.1 percent and 3.0 percent each quarter.
John Walker, national Chairman of the Federation of Small Business (FSB), said the failure to hit the 76-billion-pound lending target for SMEs is extremely disappointing.
FSB survey indicated that only one in 10 firms obtained a bank loan in 2011.
Britain now has 4.5 million small businesses, and SMEs account for 99 percent of all enterprises in Britain, 58.8 percent of private sector employment and 48.8 percent of private sector turnover, according to FSB.