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HSBC unveils Ł1bn loan fund for small firms

December 22, 2008
HSBC has announced the creation of a £1bn loan fund to help its small business customers cope with the economic downturn.

The money forms part of a total pot worth £3.4bn which the bank will distribute to SMEs around the world.

In a statement, HSBC said the finance is "new money" which comes from its "own resources" and is "over and above" what it would normally expect to lend.

Many entrepreneurs have complained of pulled lending and increased fees over recent weeks and amid government pressure banks have responded by promising measures such as freezing interest rates. HSBC however is the first bank to announce the injection of new funding.

Michael Geoghegan, HSBC's Group CEO, said: "This is a difficult time for business in many economies. Customers are rightly looking to see how banks can help.

"I am pleased that HSBC is using its financial strength to help our small business customers around the world. SMEs are the lifeblood of most economies and it is their success that will create economic growth."

HSBC, which unlike Lloyds TSB, Royal Bank of Scotland and HBOS has avoided having to take part in the government's £37bn bailout of the British banking system, said companies with a turnover of up to £25m are eligible to apply to access the new fund.

Source:http://www.businesszone.co.uk/cgi-bin