Legal & General (L&G) is set to begin lending to medium-sized UK businesses, according to the Financial Times.
The paper said the life insurer is looking to launch a lending arm by the end of the year to capitalise on growing demand from firms looking for alternatives to banks.
It would focus on ‘private placements’, the report said. It explained these placements allow firms who have been shut out of public debt markets to borrow sums lower than £20m for up to ten years.
In a video interview with the FT, L&G chief executive Nigel Wilson said: “It’s disappointing to say the least… that we [insurers] haven’t developed this as a business.
“We will step up and take over some of the roles that the banks have fulfilled over the past 20 years.”
Wilson said the lending would focus on the larger end of the SME market rather than traditional small businesses.
