HM Treasury discussion paper on non-bank lending

In January 2010 HM Treasury issued a paper to promote discussion on non bank lending channels for companies and to gather information. The paper explores:

potential barriers to the use of non-bank lending channels by large and upper mid-sized firms;
the scope for reducing these barriers so as to facilitate a more diversified funding base; and
whether there are ways for non-bank investors to invest more effectively in corporate debt.

Any initiatives to improve the non-bank lending markets will have a significant impact on companies seeking funding. The ACT recommends that members read the discussion paper and submit comments directly to the Treasury, or via the ACT (technical@treasurers.org), which will itself be making a submission. In addition since much of the paper is in the form of very specific questions the ACT has converted the questions for business into an online survey.

There are just 14 questions. Although it is possible to complete the survey without reading the discussion paper, reviewing the paper will help put the questions in context.

The survey will close on 10 February. Survey answers or comments will remain anonymous.

Complete the survey here

HM Treasury discussion paper on non-bank lending - ACT response

HM Treasury's paper promotes discussion on non-bank lending channels for companies and seeks to gather information, particularly exploring:

potential barriers to the use of non-bank lending channels by large and upper mid-sized firms;
the scope for reducing these barriers so as to facilitate a more diversified funding base; and
whether there are ways for non-bank investors to invest more effectively in corporate debt.

The ACT welcomes the Treasury's initiative and discusses a multitude of small steps which would help promote the availability of debt capital to firms. Many of the obstacles to greater use of non-bank finance are, however, in habitual behaviours and patterns of thinking and often education and development of standards will be more helpful than extensive legislative programmes.

More generally, we think that many of the issues raised for large and upper mid-sized firms will have application in respect of smaller firms, but a lot of additional considerations arise in respect of that sector which needs separate consideration.

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HM Treasury discussion paper on non-bank lending

HM Treasury discussion paper on non-bank lending - ACT response