UK banks expect to lend more to business as COVID-19 crisis deepens

FILE PHOTO: A cyclist is seen infront of the Bank of England as the spread of the coronavirus disease (COVID-19) continues, London, Britain, April 14, 2020. REUTERS/John Sibley/File Photo

LONDON (Reuters) – British banks expect to lend more to businesses but curb mortgage and consumer lending over the next three months as the country feels the economic effects of the coronavirus, a Bank of England survey showed on Thursday.

The quarterly survey, conducted between March 2 and March 20, showed growing concern from banks about the outlook as the impact of COVID-19 became more stark over the period.

“Overall availability of credit to the corporate sector was unchanged for all business sizes in Q1, but was expected to increase for all business sizes in Q2,” the BoE said.

Britain’s government has launched a 330 billion-pound government guaranteed lending scheme to support businesses through the economic shutdown it ordered to slow the spread of the coronavirus.

The BoE survey showed businesses’ demand for credit the highest since they were first asked about this in 2016.

Reporting by David Milliken; Editing by William Schomberg

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