Banks 'Still Not Lending', Centric Commercial Finance Survey Reveals

26 Nov 2009 08:30 Africa/Lagos

Banks 'Still Not Lending', Centric Commercial Finance Survey Reveals

LONDON, November 26/PRNewswire/ -- 65% of corporate financial advisers have stated that the 'the banks are not lending', according to an independent survey commissioned by Centric Commercial Finance. 72% said that cash flow was proving to be their clients' biggest challenge. Disappointingly, 56% of respondents claim that banks have removed or are restricting clients' facilities.


Tim Hawkins comments: "The market needs certainty and innovation right now. Advisers are looking to the independent asset based lending and invoice discounting sectors for liquidity for their clients, which is so notably lacking from elsewhere. These facilities have not only proven to be a valuable lifeline to businesses during the recession, they will also grow with them as they emerge from it. The renaissance of invoice discounting and asset based lending has come at exactly the right time."


Described by advisers as a 'core funding solution', 80% of respondents state that asset based lending and invoice discounting offer 'improved working capital' (66%), followed by 'higher levels of finance' (66%) over and above traditional sources.


When recommending a solution, advisers look for lenders to 'deliver the deal as promised' (86%). This is followed by 'certainty of funding' (63%), 'access to decision-makers' (51%), 'business understanding' (46%), 'speed of service' (42%), 'creativity' (37%) and 'reputation' (18%).


However, financial advisers are optimistic about the UK's emergence from recession, with 65% of accountants and finance brokers expecting to see 'significant increases' in transactional activity within the next 6 to 18 months. 26% of those surveyed anticipate a resurgence of activity within 18 to 24 months. At the two opposite ends of the spectrum, 2% believe this will happen in the next 6 months and 7% predict two years or even longer.


Whilst 77% of advisers who responded to the survey stated that 'survival' is the primary focus for their clients, 70% claim that their clients are now ready to 'exploit gaps in the market'.


In addition, 76% of advisers considered that an equity release scheme for business owners considering retirement would be a highly 'appealing' option at this time. Whilst a minority of respondents felt that some owners may elect to 'hang on for better times', the vast majority felt that equity release would be appropriate where the 'valuation is not too low'.


You can find out more about Centric Commercial Finance at http://www.CentricCF.com.


Source: Centric Commercial Finance

Contact details: Michael Symes, t +44(0)20-7520-9216 m +44(0)7736-008270