LENDING by the major UK banks to companies fell by £2.4 billion net of repayments in December, for the second successive month, industry figures have shown.

The numbers produced by the British Bankers Association (BBA) may spark renewed concern that businesses are struggling to access affordable credit although lenders such as Royal Bank of Scotland insist they are keen to lend to suitable businesses. Borrowing by all non-financial companies contracted by £15.7bn in 2014, compared with a fall of £11.6 billion in 2013. Lending to non financial businesses fell by an average £1.3bn in the six months to December. The BBA said: "Larger companies have notably been making use of capital markets to raise finance in preference to debt finance, while the real estate sector has been actively reducing its bank borrowings." The organisation said borrowing increased in the manufacturing, wholesale and retail sectors in 2014. However, it added:"Outside of real estate, annual borrowing from the High Street Banks by all other businesses in the real economy has contracted by 3.7 per cent."