Financing Europe’s small firms - Dont' bank on banks

Of the 54 firms to have listed on Borsa Italiana’s secondary market for smaller firms, 18 have done so this year. The most unusual was Blue Note Milano, a jazz club,which last month sold 40% of its shares for €1.4m ($1.9m). In Europe, small and medium-sized enterprises (SMEs) usually ask banks, not markets, for money. But new bank lending to small firms in the euro area plummeted 35% between 2008 and 2013 to €649 billion (see chart). It fell sharply in Britain too.