Banks: Lending

Lord Low of Dalston Excerpts

Wednesday 5th February 2014 Lords Chamber

[Lord Popat]

My Lords, the Minister is not painting a rosy picture. Let me take the last point made by the noble Lord, relating to competition. We will soon spin out a TSB from Lloyds Bank; we will spin out Williams & Glyn’s Bank from the Royal Bank of Scotland; we have the British Business Bank in place and the large number of private banks that have come into the market: the Metro Bank, the Shawbrook and the Cambridge & Counties Bank. There are therefore several banks coming into the market. Another thing that the regulators have done is that they looked at the regulations to make it easier for new companies to apply for banking licences. We have 20 applications being considered at the moment, so given time, we will have a number of banks in real competition.

[Lord Low of Dalston (CB)]

My Lords, if the recovery is going so well, why are businesses not investing on a more significant scale, but rather holding very considerable amounts of uninvested resources on their balance sheets?

[Lord Popat]

My Lords, you cannot force a company in the free market to make an investment, but you can create the conditions for such things to happen. I am pleased to say that the conditions in this country are now pretty good for businesses to invest money.