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Business borrowing 'reflects weak demand', company debt help customers told

Date Added: 26/10/2010  

The British Bankers' Association (BBA) has stated that new figures showing the amount of business lending can be explained because demand for loans has fallen, company debt help customers have been told.

According to the organisation's most recent statistics, net lending to non-financial companies fell by more than £3 billion during September 2010.

This is a sharper decline than in August, which saw a fall of just £1 billion.

BBA statistics director David Dooks said: "Business borrowing continues to reflect weak demand combined with companies reducing gearing by repaying bank borrowing."

Mr Dooks claimed that the figures show company debt help customers are not applying for finance as much as they were in the past due to focusing on paying off debts instead of growing.

But Michael Baxter, editor of Investment and Business News, recently stated that banks are unwilling to lend to firms in financial difficulties, such as those taking company debt help, as they are seen as a risk.

Posted by Michael Beam 

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