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LONDON (Alliance News) - Manx Financial Group PLC Monday said its Conister Bank unit has stepped up its challenge to the UK's high street banks, after signing an agreement that will allow it to provide loans in the range of GBP10,000 to GBP50,000 to small and medium-sized enterprises.
Ise of Man-based Manx Financial's shares were Monday quoted at 16.40 pence, up 1.02 pence, or 6.7%.
Conister Bank signed the agreement with Hampshire-based SME funder Corporate Asset Solutions Ltd that will enable it to make the loans.
Manx said the agreement will provide "greater diversification to [Conister Bank's] distribution network and loan book.
"The constraints in the supply of credit from the UK's 'High Street' banks to SMEs has been widely publicised. Increasingly, the new breed of 'challenger banks' like ourselves are stepping in to fill the void," Juan Kelly, Conister Bank's managing director, said in a statement. "This trend is likely to gather speed as 'High Street' banks continue to shun the SME market and financial technology continues to evolve, opening up distribution to a broader set of funders," Kelly added.
Bank finance became more difficult for SMEs to obtain in the aftermath of the financial crisis, as the UK's high street banks scaled back their lending to SMEs because of increased regulatory requirements on the amount of capital they must hold on their balance sheets to support their lending.
By Samuel Agini; samagini@alliancenews.com; @samuelagini
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