Financial News

Banks Must Repay Bail Out Favour To Taxpayers, Warns Minister

One in five small businesses could go to the wall if banks do not do more to help them, claim bosses and tax experts.

Although Chancellor Rishi Sunak has set aside billions of pounds to help them through the coronavirus shutdown, businesses say they can’t get their hands on the cash, says research by the Corporate Finance Network.

The survey results have sparked a warning from Business Secretary Alok Sharma to the banks.

“We know the banks are working really hard to support the UK through this period, including mortgage holidays and increased credit facilities,” he said.

“Ministers and regulators have written to the major banks urging them to make sure the benefits of the loan scheme are passed through to businesses.

Banks suspend billions in dividends

“It would be completely unacceptable if any banks were unfairly refusing funds to good businesses in financial difficulty.

“Just as the taxpayer stepped in to help the banks back in 2008, we will work with banks to do everything they can to repay that favour and to support the businesses and people in their time of need.”

The banks have also agreed to withhold around £15.6 billion due as dividend payments to shareholders.

Regulators and the Bank of England want them to keep the money until the economy improves and to rethink paying bonuses to high earners.

Meanwhile, the coronavirus crisis is deepening.

UK sees 563 die in a day

The latest figures show 29,474 positive cases resulting from 152,979 tests, with 2,352 dead – with 563 falling victim to the virus in the previous 24 hours.

The number of deaths was 31% in the day before and the largest number reported in a day so far.

Positive tests were also up 4,324 on the day before.

The US has 205,035 reported coronavirus cases and has seen 4,515 deaths to become the worst hit nation.

Italy and Spain are still suffering badly from the outbreak.

Italy now has 110,574 cases and 13,155 deaths, with 727 people dying in the past 24 hours.

Spain has reported 102,136 cases and 9,053 deaths – with 589 coming in the last day.

China, where the first case was reported, had seven deaths yesterday, taking the total to 3,312.

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