Sheffield is to be the base for a national bank designed to help small and medium sized businesses, it was announced this week.
The Government says more than 100 jobs will be created in setting up the the British Business Bank in disused offices at Foundry House, Millsands, near West Bar.
The venture will lend £1.25bn to companies, helping them to expand at a time when the economy is moving out of recession.
It was formally launched in October, but had not before now been given a permanent home.
Deputy Prime Minister and Hallam MP Nick Clegg is believed to have lobbied strongly for the project to be based in Sheffield, with the availability of office space a key factor.
Although some loans have already been approved, the bank will not become fully operational until next autumn when European Commission permission has been confirmed.
Business secretary Vince Cable said the bank will help the UK’s 4.9m small and medium sized firms:
“It is a new long-term institution which is helping to create more competition in the banking sector and give access to finance to businesses who are currently struggling with high street banks, to get the cash they need to invest in their future growth.”
Mr Clegg said:“It’s a huge vote of confidence for our city and demonstrates the excellent business skills located here. But this isn’t just great news for Sheffield, it’s great news for small businesses and the millions of people who work in them across the UK. If the banks aren’t lending enough, businesses can’t grow and our recovery slows down.
“This bank ensures they have a range of options for investment – making it easier for businesses in Sheffield and across the UK to expand, create new jobs and help rebuild our economy.”
The bank is being set up as a state-backed economic development bank ‘to create more effective and efficient finance markets for smaller businesses in the UK’.
Gordon Millward, regional chairman of the Federation of Small Businesses, said Sheffield was being seen by the Government as a key player in the UK’s finance sector. “The finance through the Business Bank needs to help very small and start-up businesses who we know find it hard to raise finance through the main high street banks.”