A total of 56 companies, including British Airways, Burberry and Rolls-Royce, borrowed £16.2bn through the Bank of England’s coronavirus funding scheme in the three months to June 3, according to data released by the UK central bank.
The Bank of England on June 4 published for the first time a list of the companies that have borrowed money through its Covid Corporate Financing Facility, which was set up on March 17.
The scheme was launched to ease pressure on corporate cash flows caused by the coronavirus crisis. As part of it, the Bank of England purchases commercial paper issued by firms with an investment grade rating, thereby channelling funds to UK companies.
Naming the companies using the scheme has attracted criticism from members of the UK parliament, however. MPs including the Conservative party’s Andrew Mitchell and Labour’s Margaret Hodge have complained that the money lent out under the scheme is not being used to help companies weather the Covid-19 crisis because some of the firms named are still paying dividends to shareholders, according to a report in the Financial Times.
The Bank of England’s June 4 data also indicates there is waning demand for the emergency funding, with £16.2bn arranged through the scheme by June 3. In May, Financial News reported that £15.9bn in financing had been distributed by the scheme as of 29 April.
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