By Alexander Baiden, Scott Brind and Carly Fields
The Bank of England currently publishes a number of series on monetary financial institutions’ (MFIs’) lending to UK non-financial businesses. This includes a split of gross lending, repayments, and loan and overdraft balances by business size; for small and medium-sized enterprises (SMEs) and large businesses. These data are published on a monthly frequency in Bankstats Table A8.1, and are available from April 2011.
The collection underlying these series also includes data on lending to UK non-financial businesses by major industrial sector. These data were previewed in the Bank of England’s Credit Conditions Review. Going forward, these data will be available on a monthly basis from the next publication of Bankstats, in Table A8.1, with series starting in April 2011.
Furthermore, following a regular review of the Bank of England’s statistical Form LN, new series were introduced from January 2016 to provide additional granularity of these data, including a further industrial breakdown by business size. These data will also be available from the January 2017 Bankstats publication, within tables A8.1.1 (SMEs), and A8.1.2 (large businesses). Key aspects of these series are provided below.
Industrial analysis of lending to non-financial businesses.
Gross lending flows to all non-financial businesses has increased in recent years and was £234 billion in 2016 (Chart A). Within this, the real estate and distribution sectors accounted for around £42 billion.
Gross lending to SMEs was £59 billion in 2016 (Chart B). Based on the data collected from January 2016, lending to the real estate sector accounted for around a quarter of this.
Gross lending to large businesses was more broadly spread in 2016. The distribution sector accounted for 18%, and the real estate and manufacturing sectors each accounted for around 15% (Chart C).
Cumulative net bank lending (excluding overdrafts) in 2016 was higher than in previous years across business sizes (Chart D). Within this, cumulative net lending to the professional and other services sector contributed £4.3 billion. The annual growth rate in the stock of lending to UK businesses increased to 3.6% in December 2016.
The real estate sector accounted for a significant proportion of the stock of loans outstanding across business sizes as at December 2016, but had a small share within the stock of overdrafts (Chart E).
Overdrafts, which are generally used as a form of working capital for businesses, accounted for 8% of the amounts outstanding of loans to UK businesses as at December 2016. This proportion was broadly the same across business sizes.
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