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RBS falls 2% after failing BoE stress test

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China capital curbs reflect buyer’s remorse over market reforms

Last year the reformist head of China’s central bank convinced his Communist party bosses to give market forces a bigger say in setting the renminbi’s daily “reference rate” against the US dollar. In return, Zhou Xiaochuan assured his more conservative party colleagues that the redback would finally secure coveted recognition as an official reserve currency […]

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Carney: UK is ‘investment banker for Europe’

The governor of the Bank of England has repeated his calls for a “smooth and orderly” UK exit from the EU, saying that a transition out of the bloc will happen, it was just a case of “when and how”. Responding to the BoE’s latest bank stress tests, where lenders overall emerged with more resilient […]

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Categorized | Banks

Former bank chief to chair advisory board

Posted on December 18, 2012

Sir Peter Burt, former chief executive of Bank of Scotland, is to chair the advisory board that will shape the business bank being set up by the coalition to improve lending to small businesses.

The board will establish the framework for the bank being set up by George Osborne, chancellor, and Vince Cable, business secretary.

    The recruitment of one of the few senior British bankers who remains untainted by the financial crisis is part of the coalition’s effort to show it can tackle the problem of small and medium-sized companies being starved of credit.

    Mr Cable is expected to announce details of the bank in a written ministerial statement tomorrow. In his Autumn Statement, Mr Osborne said it would be seeded with £1bn of government funding, but there has been little detail about the venture, which will not be operational until 2014.

    As chief executive of Bank of Scotland between 1996 and 2001, Sir Peter engineered its merger with Halifax to create HBOS. He stepped down as deputy chairman in 2003.

    It is thought that Sir Nigel Rudd, chairman of the bank-supported Business Growth Fund, which takes stakes in UK-based SMEs, has also been asked to join the advisory board to ensure co-ordination between the two projects. If Sir Nigel accepts the invitation, Stephen Welton, BGF chief executive, could step up to replace him.

    The business bank is seen as a long-term initiative to plug the gap in finance for SMEs rather than a short-term effort to boost credit, for which Mr Osborne’s “funding for lending” scheme is the latest government initiative.