UK Treasury calls for more choice in business finance – proposals for reform to follow later this year
12 January 2010
Work to increase options for UK businesses in need of non-bank finance is the subject of a discussion document released by the Treasury. The document focuses on a range of issues including credit assessment and monitoring of non-bank loan markets and high-yield bond markets.
Work to increase options for UK businesses in need of non-bank finance is the subject of a discussion document released by the Treasury. The document seeks views on the barriers to more diverse financing for firms with the intention to introduce proposals for reform later in the year.
Financial Services Secretary to the Treasury, Paul Myners said:
“The extraordinary events in credit markets over the past two years have shown that the continued availability of any single form of business finance cannot be taken for granted. Right across the world, firms that had relied on loans from banks to finance their operations found themselves in a very difficult situation when bank lending contracted.”
“Here in the UK, our large corporations have had a great deal of success in accessing finance directly from credit markets with a surge in corporate bond issuances. Smaller firms, however, have not been able to similarly replace bank lending by directly tapping financial markets or non-bank financing.”
The Treasury announced its plans to publish a discussion paper on non-bank lending channels in December’s Pre-Budget Report. The published document focuses on a range of issues relating to business finance including:
- credit assessment and monitoring;
- corporate transparency;
- transparency in the pricing of bank loans;
- UK investor preferences;
- non-bank loan markets and high-yield bond markets.
Deadline for comments is 14 February 2010
© HM Treasury
