CLBILS extended from £50 million to £200 million

Businesses have benefitted from over £32 billion in loans and guarantees to support their cashflow during the crisis.

This includes 268,000 Bounce Back Loans worth £8.3 billion, 36,000 loans worth over £6 billion through the Coronavirus Business Interruption Loan Scheme, and £359 million through the Coronavirus Large Business Interruption Loan Scheme, alongside £18.7 billion through the CCFF.

Companies borrowing more than £50 million through CLBILS will be subject to restrictions on dividend payments, senior pay and share buy-backs during the period of the loan, including a ban on dividend payments and cash bonuses, except where they were previously agreed.

These restrictions will also apply to CCFF participants that wish to borrow money beyond 12 months from today.

This will ensure that the money is used to keep the company going through the crisis. The Bank will also publish a list of companies who have benefitted under CCFF on 4 June.

Further Information

– borrowers under CLBILS will be able to borrow up to 25% of turnover, up to a maximum of £200 million

– lenders who wish to offer larger loans will need to undergo further accreditation checks

The restrictions in place will include:

– Dividends: Borrowers cannot make any dividend payments

– Share buyback: Borrowers agree any share buybacks

– Executive pay: Borrowers cannot pay any cash bonuses or award any pay rises to senior management (including the board) except where they were a) declared before the CLBILS loan was taken out, b) is in keeping with similar payments made in the preceding 12 months, and c) does not have a material negative impact on the borrower’s ability to repay the loan.