Business lending falls

Banks hoping for a pick-up in business lending will be frustrated to learn that there has been no clear trend in the commercial finance market this year. Australian Bureau of Statistics numbers were up strongly in January, down in February, up in March and April, before easing back in May.

According to the latest ABS commercial finance figures, new lending to business fell 1.7 per cent in May, compared with the previous month (in seasonally adjusted terms).

The value of business lending commitments in May was A$45.6 billion, made up of $33.1 billion of fixed loans and $12.4 billion of revolving credit.

Reserve Bank figures released earlier this month show that the longer- term trend is positive. Lender's business credit balances grew by 5.2 per cent over the 12 months to May.