Lloyds takes on $1.6bn from Funding for Lending scheme

20 September 2012

Lloyds has become the first bank to take advantage of the British government's Funding for Lending scheme (FLS).

The financier announced yesterday (19 September) that it has drawn some £1 billion ($1.6 billion) from the initiative, as it seeks to increase the amount it is able to loan to businesses, the Independent reports.

Under the terms of the FLS, the Bank of England and the Treasury have joined forces to provide funding worth some £80 billion to financiers at low interest rates over four years on the premise they pass these savings on to companies and households.

The Conservative-Liberal Democrat alliance is hopeful that the programme will stimulate business activity and therefore help boost economic activity.

And Antonio Horta-Osario, chief executive of Lloyds, has indicated that his organization will use the FLS on a regular basis.

"This initial £1 billion is just the start. We are committed to helping Britain prosper by encouraging investment and supporting businesses and households," he noted.

By Tony Aynsley

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