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UK panel to oversee loans to small firms

Britain on Tuesday announced the creation of a new panel to monitor lending by the nation’s banks to small businesses.

The Small Business Finance Forum will include senior officials from the business ministry, the Treasury and the Bank of England, Britain’s central bank.

According to a business ministry statement, Britain’s five main high street banks has pledged to provide the forum with information on the availability, risk and cost of lending to small and medium businesses.

“It is critical we understand what finance is available for small businesses and this monitoring panel will give us greater insight into the situation at ground level,” Business Secretary Peter Mandelson said.

In a rescue package for Britain’s ailing banking industry last month, the government required that, as a condition of rescue, banks increase lending to property owners and small businesses to last year’s levels.
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