I'm not surprised the Chancellor and PM are exasperated with the banks' apparent reluctance to lend money to consumers and businesses at reasonable rates.
Let's face it though, banks got some real stick for lending money irresponsibly during the "good times", and now, when bank managers are seeing a stream of businesses looking for finance to see them through , in many cases , lossmaking times, they sure as hell don't want to be criticised for irresponsible lending in "bad times". Mind you, talk of the government stepping in to underwrite bank loans to small businesses is not something I'd applaud; surely, that would be like giving the green light to the banks to dish out money to bad credit risks; if all turns out OK, the bank wins..... and if things go pearshaped........... the bank wins again as the government will step in to foot the bill (with taxpayers money).

No, the government has to take all other steps to ensure we get back to some normality vis a vis bank lending, including threats of legal action if money doesn't start flowing again to those that need it.