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Essex councillors set up own bank Essex councillors set up own bank
(about 6 hours later)
Essex County Council is setting up a bank to help firms struggling to get finance during the recession.Essex County Council is setting up a bank to help firms struggling to get finance during the recession.
The council is setting aside £50m for loans of up to £100,000 for small and medium-sized businesses which have been trading for at least a year.The council is setting aside £50m for loans of up to £100,000 for small and medium-sized businesses which have been trading for at least a year.
The bank is being created under powers which councils have to promote the economic well-being of their area.The bank is being created under powers which councils have to promote the economic well-being of their area.
"Bank of Essex" could be set up within a year after going through all the necessary legal and regulatory work."Bank of Essex" could be set up within a year after going through all the necessary legal and regulatory work.
Banking giantBanking giant
BBC News local government correspondent John Andrew says the council sees the move as a shift away from a remote centralised system of banking to one more responsive to local needs.BBC News local government correspondent John Andrew says the council sees the move as a shift away from a remote centralised system of banking to one more responsive to local needs.
The initiative will work in partnership with banking giant Santander, making it the first council-run bank for more than 30 years.The initiative will work in partnership with banking giant Santander, making it the first council-run bank for more than 30 years.
The Birmingham Municipal Bank, established during World War I, survived until 1976.The Birmingham Municipal Bank, established during World War I, survived until 1976.
The council already has an award-winning £1.5m scheme which has seen closed post offices reopen in the county.The council already has an award-winning £1.5m scheme which has seen closed post offices reopen in the county.
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