The Development Bank of Wales is expected to launch new funds to support firms in particularly hard pressed sectors as a result of the pandemic this autumn, Economy Minister Ken Skates has confirmed.
The development bank, which is wholly-owned by the Welsh Government, has now fully invested its £100m Covid-19 loan scheme to SMEs, following its launch in March. New funds are expected to be sector specific, like tourism.
Mr Skates said consideration was given to refinancing the development bank’s Covid loans with other financial providers, as well as its other existing loan and equity book, potentially with an institutional investor [s], to provide new finance.
Mr Skates said: “We examined proposals in detail with the development bank and it was decided the precise proposal with the high street banks may not be in the best interest of the development bank and its customers.
“However, the development bank is looking at methods at extracting more finance from existing products in order to support key sectors including the tourism sector.
“We hope to give an announcement on a further package of support from the development bank over the late summer period ready for deployment in the autumn when many of those businesses in those critically important sectors will face the challenges of what we have left of the summer season and the arrival of the autumn and winter period.
"So, I have said to development bank and BusinessWales officials, that it is absolutely vital that we give considerable thought now to those sectors that are going to be most at risk as we enter and go through the autumn and winter period.
"However, I am confident that what will be announced by the development bank will go along way to meeting the needs of tourism-based businesses and other business within particularly important sectors.”
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Figures show that 41,500 firms in Wales has been offered funding of £1.4bn under the 海角视频 Government’s Covid-19 Bounce Back Loan Scheme (BBLS) and the Coronavirus Business Interruption Loan (CBILS).
The schemes, administered by the 海角视频 Government’s economic development bank the British Business Bank, has more than 80 accredited which include all the high street banks.
The latest figures from the Treasury show that 40,000 loans worth over £1.1bn have been offered to firms across Wales under BBLS which provides a six-year term loan from £2,000 up to 25% of a business’ turnover, with a limit of £50,000.
On CBILS some 1,300 loans worth almost £303m have been offered across to firms in Wales. CBILS provides loans, overdrafts, invoice finance and asset finance of up to £5m to businesses with a turnover less than £45m.
The British Business Bank rejected an application from the Development Bank of Wales to be a CBILS accredited lender, as it said that more than 30% of its funding came from public sources.
The vast majority of the development bank's funding comes from the Welsh Government, via transaction finance capital from the 海角视频 Treasury, and the European Union.