State funding worth some £40 billion ($65 billion) will be required if the British government's new business bank is to be successful.
That is according to a new report from the Institute for Public Policy Research (IPPR) released today (19 September), which has indicated the financier will need a significant initial capital investment from the administration.
Last week, business secretary Vince Cable unveiled plans to create a lender that exists specifically to assist companies access the credit they need to grow on the basis this is a good way to boost the UK's general economic recovery.
However, in a study entitled Investing for the Future: Why we need a British Investment Bank, the IPPR has warned that making this idea work will not be easy.
For instance, as well as an injection of £40 billion from the government, the think tank indicated the new bank must also be permitted to raise as much as £100 billion on capital markets.
By Gary Cooper