Small Business Lending Still Sluggish on Global Level

WASHINGTON, Nov. 30, 2011 /PRNewswire/ -- While lending to large companies is rising steadily across the globe, small- and medium-sized businesses struggle to obtain financing. Maximizing Results, Minimizing Risks, a new paper from Omega Performance, examines the reasons for the reluctance to lend to small businesses and what the financial services industry needs to do to help this important sector stay funded.

The paper also looks at the recent history of lending, the circumstances that led to the financial crisis of 2007, and the banking industry's current efforts to avoid those same mistakes. "Because there is no useful credit risk transfer option for smaller loans, lending institutions know that they can't trade out of a loan and instead must bear the entire risk," said John Golden, President and CEO of Omega Performance. "The temptation is for banks to steer clear of multiple, harder-to-understand small and middle market loans in favor of fewer larger, but safer credits. This bias toward large organizations might minimize the risks for financial institutions in the near term, but it limits growth in the long term."

The state of banking in six countries is highlighted in a series of videos on banking in Australia, Canada, China, Singapore, the United Kingdom, and the United States.

The paper, executive summary, podcast, and all videos can be accessed at http://www.omega-performance.com/MRMR.

About Omega Performance

Omega Performance equips companies with the credit skills to source and structure high-quality, profitable loans to help grow a more profitable, lower-risk loan portfolio. Since 1976, Omega Performance has provided training to more than two million people in over 2,500 financial services organizations around the world to help increase individual success and achieve company goals. Omega is a wholly owned subsidiary of Informa plc.

SOURCE Omega Performance