In December I spoke to a High Street bank who are closed for new business, principally because their focus is exclusively targeted on CBILS – in terms of managing the loans on their book, and new applications.

If this sounds dramatic there is both a manpower constraint and a looming capital challenge for banks – as credit quality deteriorates banks absorb capital, and whilst pre-Covid capital ratios were healthy, it is likely that picture is changing. This week regulators have announced that banks can resume dividend payments, creating a further pressure-point on capital, this time from shareholders.

We have seen this movie before – capital scarcity leads to debt scarcity, and marginal transactions won’t be funded, or at least if they are, they will be more expensive.

More reason to use your professional advisors that know the market to locate the funding you need. Get in touch if you need help, because banks are not handing out any presents this year, and best not to rely on Father Christmas either….