Presumably, George Osborne and Vince Cable's colleagues at HM Treasury, which owns an 84% stake in RBS, haven't had the memo about the urgent need to increase lending to small businesses. Or perhaps they're just as confused as the banks are by the twin commands to de-leverage their balance sheets while increasing their lending.
Either way, Lombard has decided that print is "not an area of focus... currently", which is 2010 bankspeak for "don't ask us for any money and we won't have to tell you you can't have any".
Discredited
Greg Handley, managing director of secondhand equipment dealer West Park Graphic Equipment, which was a client of Lombard's, says that his stocking line with the bank is theoretically still available, but that changes to the terms and conditions give a clear indication that the bank is no longer interested in lending to the print sector.
"Lombard used to be involved in all kinds of things in the printing industry and I think, truth be told, they've had their fingers badly burnt," he says.
"You don't have to be Einstein to work out that they're not really interested in doing it anymore."
Lombard has stressed that its appetite for print debt is unaffected by its stocking decision. However, David Bunker, director of Close Print Finance, is dubious about the veracity of this assertion.
"I think Lombard and other high-street banks have for some time lost their appetite for asset finance and non-core business," he said. "In the last two years they have wanted to retain as much capital as possible because of the capital ratio requirements imposed on them by the government."
Following the global financial meltdown that led to, among other things, the nationalisation of RBS, the government decided to impose capital requirements on banks to safeguard against the taxpayer having to bail them out again in the future.
The banks were required to – in some cases dramatically – reduce the ratio of risky assets they hold in proportion to their capital. The riskier the asset, the more capital the bank is required to hold against it. "They're looking to warehouse as much capital as possible and asset finance is quite capital- intensive in terms of people and administration," says Bunker.
Risky business
This de-leveraging process has naturally had a knock-on effect on the availability of finance, particularly in a sector such as print, which has long been seen as risky.
"Print has always been seen as a difficult area for banks because of the over-supply in the sector, printers cutting margins and the ease with which they can close down and start again," says Gerry Hoare of advisory boutique Deal Bureau.
"If a second recession is coming, the printers could be hit hard and first; therefore the banks are being cautious, although I think possibly they are going to be looking at all SMEs."
Change of focus
While the banks have been focusing on their large corporate exposure up until now and managing those clients, Hoare believes they may now be looking for smaller fish to fry.
"If they feel they have those large corporates under control then the focus for recovery and managing risk may have moved to the smaller businesses," he says. "This won't be good news for printers going into the final quarter of the year, as credit will become very tight."
Clearly the world is still coming to terms with the impact of the Credit Crunch and the recession and, despite the stuttering return to growth of the UK economy and the posturing of our politicians, access to finance remains a problem.
According to Mark Nelson, of Compass Business Finance, Lombard's decision reflects a current trend but also fits into a long-term lending cycle that has seen lenders come and go in the past. "Banks pulling out of the print market at this time, is not something that comes as a great surprise," he says.
"There are a number that have already unofficially gone down this route and history tells us that eventually they will return. There is a cycle in the banks that means they over-lend to a particular industry, take some bad debts and then pull out completely."
