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Business leaders call for stable banking

Small business leaders have called for banks to stabilise terms to help independent retailers ride out the economic crisis.

The British Shops and Stores Association (BSSA) chief executive John Dean has asked banks to maintain existing overdraft and lending facilities.

Dean said the banking crisis was now a "macro issue" and while larger retailers would be hit first, there would be shockwaves to smaller independents.

Dean said: "I am optimistic that interest rates will continue to go down and that should be passed through to banking. But in the medium to long term there will be inflationary pressures on top of the difficulties a recession will bring."

Dean said he was writing to HSBC, the bank which has close ties with the BSSA and which has not suffered as much from the banking crisis, to reiterate the need for stable banking terms for BSSA members.

Dean called for BSSA members to contact him with any issues they were facing throughout the banking crisis.

International Fashion Federation chairman Glynn AlwynJones welcomed the govern-ment rescue deal announced this week, in which three of the UK’s biggest banks will be urged to lend to small businesses (SMEs) at levels equal to last year.

He said it was a step to restore confidence in the banking system for independent retailers, adding: "Retailers have felt unsupported by their bankers, this is good news for SMEs."

This week, the government announced a £37 billion emergency rescue package. As part of the deal, it said the banks must maintain for three years the “availability and active market-ing of competitively-priced lending to small businesses at 2007 levels".

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