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Banks: EU Grants and Loans

Volume 486: debated on Thursday 22 January 2009

To ask the Chancellor of the Exchequer what the monetary value of the loans made available to United Kingdom banks by the European Investment Bank (EIB) under the scheme announced on 30 October 2008 was on 12 January 2008; which United Kingdom banks have applied for funds; when each first applied; how much each received from the EIB; how many businesses have accessed the funds from each; and what the average number of employees of these businesses is. (248586)

[holding answer 19 January 2009]: Since 30 October 2008, the following EIB loans for SMEs have been agreed between the EIB and UK banks:

Barclays signed a £150 million loan on 16 December 2008;

HBOS signed a £250 million loan on 18 December 2008; and

RBS signed a £250 million loan on 23 December 2008.

This means that since the reform by the EIB of its SME financing products in September 2008, a total of £1 billion of EIB loans for SMEs were made available by the end of last year. Further negotiations with a number of UK banks for additional new lending are ongoing.

The Government do not currently hold information on the number of firms to have accessed the agreed funding. The Government continue to work closely with all UK banks to monitor their progress on drawing down and disbursing EIB loans.

With regard to the number of employees of recipient SMEs, EIB rules state that its funding is available for businesses with 250 employees or less, consistent with the European Commission’s definition of SMEs.