UK bank lending to businesses contracts in first quarter -BoE

LONDON Thu May 29, 2014 4:54am EDT

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LONDON May 29 (Reuters) - The Bank of England said net lending to businesses by banks and building societies taking part in its Funding for Lending Scheme (FLS) fell by 2.7 billion pounds in the first quarter of 2014.

Banks have drawn down 43.3 billion pounds ($72.3 billion) of cheap funds from the FLS since it was introduced last year.

The latest data covers an extension to the scheme which was designed to provide cheap funding for banks and building societies to lend to UK businesses.

The data showed net lending fell the most at Britain's biggest retail bank Lloyds, which lent 2 billion pounds less to businesses during the period.

($1 = 0.5986 British Pounds) (Reporting by Matt Scuffham; Editing by Steve Slater)

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