Company confidence may spark demand for business loans, study hints

Mon, 05 Mar 2007

Companies are becoming increasingly confident about the chances of increasing business over the coming months, in news that could potentially spark demand for business loans.

According to the monthly business barometer from banking offshoot Lloyds TSB Corporate Markets, 69 per cent of firms questioned predict that their level of business activity will increase during the coming year.

To put this into perspective, 62 per cent of organisations polled in January 2007 expected business to increase, while in December 2006 the figure stood at 58 per cent.

Strong demand for British services across Europe, allied to resilient demand in the UK, is contributing towards this renewed business confidence, claimed Trevor Williams, chief economist at Lloyds TSB Corporate Markets.

"As well as this, we're witnessing a boom in business investment and accelerating consumer spending, providing a solid foundation for rising business confidence," he said.

Firms that are optimistic about their future prospects may wish to consider arranging long-term business loans to boost stock levels or manufacturing output.

The companies can then pay back the sum borrowed over a number of years as the business grows.

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