Darling's dressing down of banks met with indifference

CHANCELLOR Alistair Darling urged bank bosses to increase credit to small firms in a meeting at the Treasury yesterday, but found his efforts dismissed as a PR stunt by City figures and politicians alike.<br /><br />Darling summoned the chief executives of the UK&rsquo;s major banks to Whitehall, as part of ongoing meetings aimed at resolving the crisis of funding to small businesses.<br /><br />&ldquo;I&rsquo;ve made it clear that we need to get lending going, particularly to small and medium-sized businesses in this country,&rdquo; he said.<br /><br />He signalled that the Treasury would pore through the books of individual banks to ensure that businesses were getting the best deal.<br /><br />But British Bankers&rsquo; Association&nbsp; (BBA) chief executive Angela Knight poured scorn on the high-profile nature of the meeting.<br /><br />&ldquo;My message to the chancellor is that what we should be doing here is not exchanging one-liners on TV and radio programmes.&rdquo;<br /><br />She pointed out that although the Bank of England&rsquo;s base rate was low, wholesale funding was proving costly for banks. <br /><br />Her comments came as BBA figures showed that lending to small firms rose by &pound;391m, quickening the pace from a &pound;287m increase seen in April.<br /><br />Darling warned that if banks did not increase their supply of affordable loans to small and medium-sized businesses they would face the threat of a competition investigation if compelling evidence of market failure emerges.