Pictured above: Paul Kalinauckas, chief executive, BCRS

Wolverhampton based loans company Black Country Reinvestment Society (BCRS) have released the first of their Quarterly Lending Reviews for 2011. The first, the Quarterly Conditions Outlook, details the BCRS view of how the local economy will perform over the first quarter of 2011. 

The review is based on information gathered from public sources, in addition to BCRS' own business trends and feedback from their own customers and contacts in the Black Country and Staffordshire. 

The report covers problems and outlook in bank lending, construction, manufacturing, transport and distribution and the public sector and outlines that growth has slowed but outlook is one of cautious optimism, with GDP (gross domestic product) showing between just 1.0 - 1.5 per cent growth for the next 12 months, and interest rates continuing to remain very low for some months. 

The BCRS report states that some firms continue to struggle, with common features including insufficient attention given to future business cashflow as managers and company owners concentrate on day to day issues. Over borrowing and under capitalisation continues to be of concern for business. 

Paul Kalinauckas, chief executive of BCRS, said "Our findings have revealed that those businesses with good management in growing sectors that have secured good contracts are performing very well. These are the type of businesses that should be funded by the banks but are increasingly looking to BCRS for support. We are continuing to receive funding requests for working capital as the banks are still restructuring, and occasionally removing, overdraft facilities for their clients. We have a number of customers who would have their plans for growth restricted if we were not able to loan to them, and are still seeing cases where customers are struggling to work with inappropriate invoice financing."