Banks Must Support Local Businesses And Residents

1.49.30pm GMT Thu 30th Oct 2008

• QUITE a number of local businesses and residents are being caught in the firing line of the bank credit crunch despite the Government's £500 billion rescue plan.

Local residents have contacted MP Susan Kramer with stories such as a charge of a £100 arrangement fee to provide a £500 overdraft for just one week. Small businesses are finding credit hard to come by. Some of the worst hit, are firms which have not borrowed in the past but now need bank credit to cope with late paying customers. These are good companies but the banks seem to have little or no interest. Quite a number of local people have found their money frozen in Icelandic bank accounts in the Isle of Man. They will not know for another month if they will see any of their money back.

Kramer said: "I have been asking questions of Government ministers but they seem out of touch with how hard both small businesses and some residents are being hit. We own many of these banks now and while none of us want them to make stupid decisions, it seems they have just about shut up shop to new borrowers. We need a new code of practice quickly to get sensible lending going again. And if we are to limit the recession, interest rates need to come down fast."