UK banks wrote off a record £17.3bn of bad debts in 2010, an eight per cent increase on 2009’s figure of £16.1bn.

The increase was in part due to a 29 per cent rise in bad credit card debt to £5.32bn, up from £4.12bn last year, according to research by finance broker Syscap.

Syscap said that subsequently a rebound in levels of bank lending was unlikely in the near future.

Philip White, chief executive of Syscap, added that small and medium-sized enterprises (SMEs) should look towards leasing as a way to raise capital as it is less of a drain on banks’ balance sheets.

White said: "SMEs that are looking to expand, create jobs and invest are going to find getting a conventional loan from a bank a hard slog. Businesses will find it easier to raise capital investment by securing funds against that asset through leasing rather then by getting a normal loan."

Figures from the Finance and Leasing Association show that total asset finance provided to businesses, in the three months to.....Read more HERE