UPDATE 1-Britain seeks to boost exports with new BoE funding rules
(Adds context, quotes from finance minister)
LONDON, April 7 (Reuters) - Britain announced new measures on Monday to help exporters raise financing as the government seeks to add more balance to an economic recovery reliant on domestic demand.
The changes will allow financial institutions to use export credit notes guaranteed by the British government's trade promotion agency as collateral at the Bank of England, the central bank said.
Finance minister George Osborne said that would make it much less risky for banks to lend money to British exporters and so cheapen finance for firms looking to sell abroad.
"That should mean billions of extra lending will be made available to our exporters," Osborne said in a speech to business leaders in Rio de Janeiro during a visit to Brazil.
The BoE said it was working with the government to allow future export credit loans to be used as collateral.
In last month's budget announcement, Osborne said he wanted to create the most competitive export finance regime in Europe.
The finance ministry said on Monday the collateral rule change could help reduce the cost of private-sector export finance loans by 5 to 10 basis points.
Osborne announced in March that the government's direct-lending programme would be doubled in size to provide 3 billion pounds in finance to exporters. (Reporting by David Milliken and William James; Editing by Catherine Evans)
- Ukraine president accuses Russian soldiers of backing rebel thrust |
- Video shows Islamic State executes scores of Syrian soldiers |
- In town halls, U.S. lawmakers hear voter anger over illegal migrants |
- U.S. air strikes on Syria would face formidable obstacles
- Ukraine leader says Russian forces are in the country as key town falls