What is it?
The Bank of England will provide funding – aimed at large businesses – by purchasing commercial paper of up to one-year maturity. The facility will offer financing on terms comparable to those prevailing in markets in the period before the impact of Covid-19. The facility will look through temporary impacts on firms’ balance sheets and cash flows by basing eligibility on firms’ credit ratings prior to the Covid-19 shock. The scheme will operate for at least 12 months.
Eligibility: The scheme is open to firms that can demonstrate that they were in sound financial health prior to the impact of Coronavirus. Companies who wish to use the scheme do not need to have issued commercial paper before. Here is further information for firms looking to participate in the scheme.
If your firm does not have an existing credit rating from the major credit ratings agencies, the Bank of England recommend that you speak to your bank in the first instance.
If that bank’s advice is that the firm was viewed internally as equivalent to investment grade as at 1 March 2020, then contacting the Bank of England at: [email protected] to discuss your potential eligibility. The central bank will then make an assessment of whether you can be deemed as equivalent to having a public investment grade rating.
When can I access the scheme?
The scheme is open for applications.
Who do I need to speak to?
Speak to your bank. It is important to note that not all banks issue commercial paper. If your bank does not issue commercial paper, UK Finance has provided a list of those banks that are able to assist.
