The Government has extended the size of loans available to large businesses who have been impacted by coronavirus.
The Treasury said that firms will now be able to receive up to £200 million from the Coronavirus Large Business Interruption Loan Scheme, which previously had a maximum pay-out of £50 million.
However the extension has come with several conditions.
Companies borrowing more than £50 million through 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 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 benefited under CCFF on 4 June.
Rain Newton-Smith, CBI Chief Economist, said:
“Some mid-cap businesses urgently need access to larger loans to tide them over at this critical juncture for the economy.
“Many of them are important regional employers, so the Treasury’s extension of maximum loans to £200m shows just how much they are listening to the concerns of business right now.
“Bounce Back loans are the standout success so far among government packages supporting firms’ cashflow amid the crisis. Meanwhile, lenders are continuing to act at speed to get emergency funds to those businesses most in need.
