Small businesses in the UK will get a helping hand from the acquisition of Singers Asset Finance by a relatively new lending institution, Shawbrook Bank, which completed the transaction on 22 March.
Shawbrook was created in 2011 as a specialist savings and lending bank committed to increasing the volume of loans made to small and medium businesses.
Chaired by former RBS head Sir George Matthewson, Shawbrook joins the small but hopefully growing ranks of UK banks such as Aldermore and Metro Bank, launched since the beginning of the credit crisis whose stated aim is to make it easier for ‘young’ businesses to get a solid foothold in an economy just now emerging from recession.
These new enterprises offer options that they hope will challenge the country’s lending giants, banks the government has repeatedly taken to task for their hesitancy in loaning money to SMEs. Owen Woodley, Shawbrook’s chief executive, is confident that the merger with Singer will give his company the means to increase its client base and lending capacity, and to provide more timely service than the big banks have been seen to offer.
Woodley told Reuters news agency that the deal would add £350 million to its loan book, bringing it up to around £500 million, and he expects that figure to reach £700 million by the end of 2012, with a combined client base of at least 25,000.
Shawbrook, Woodley added, will be opting out of George Osborne’s new credit easing plan meant to make it easier for SMEs to borrow money from the big banks. He feels the scheme will not be advantageous to banks like Shawbrook that raise most of their funds from retail deposits as opposed to wholesale financial markets.
Singer and Shawbrook respectively are oriented towards financial solutions for small business, and combining their resources and expertise should benefit both of them, as well as their growing clientele.