Bloomberg News

Sarkozy Criticizes French Banks for Failing to Provide Credit

February 01, 2012

Feb. 1 (Bloomberg) -- French President Nicolas Sarkozy criticized banks for failing to lend to companies, forcing the government to fill the credit shortfall.

“To find financing for small companies, we had to create OSEO,” he told a conference of entrepreneurs in Paris, referring to a state-backed lending unit. “To find funding for large industry, we have to create a bank for industry. You have to question what banks are for.”

Sarkozy announced last month that he plans to create a financing arm for French industrial companies.

Euro-area lenders tightened credit standards in the fourth quarter and expect to make it more difficult to obtain loans in the first three months of the year, the European Central Bank said today. “The net tightening of credit standards by euro- area banks surged in the fourth quarter,” the Frankfurt-based ECB said, citing its quarterly Bank Lending Survey. “Looking ahead, euro-area banks expect a further net tightening of credit standards, albeit at a slower pace.”

Sarkozy said banks aren’t his “enemy,” in contrast to Socialist Francois Hollande, who is leading Sarkozy in the polls ahead of presidential elections in April and May. Hollande, in his opening campaign speech, said “my enemy is finance.”

“Whenever there is a speculative burst, there’s abundant credit and we create a real bubbles that explode,” Sarkozy said. “But when we have a small company that wants to buy a machine because it sees a market, it’s a battle to get a loan. It’s not acceptable, and that’s not my idea of what banks are for.”

--Editors: James Hertling, Simone Meier

-0- Feb/01/2012 11:54 GMT

To contact the reporter on this story: Gregory Viscusi in Paris at gviscusi@bloomberg.net

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net -0- Feb/01/2012 11:46 GMT


Toyota's Hydrogen Man
LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus