Background
The Policy and Technical team continues to speak with treasurers to understand what issues they are facing and in what areas the ACT can help. We are also talking with the main banks to understand how they are responding to the COVID-19 crisis. At the same time, we have held a number of conversations with HM Treasury, the Bank of England, the CBI, the City of London Corporation and UK Finance. Through these forums we have been able to ensure that the views of the treasury community are heard by policymakers through a number of different channels.
A list of useful material from the ACT, the Regulators, the Government and Others can be accessed from the ACT Knowledge Hub.
Please continue to answer the 3 quick questions in our “temperature check” so that we can share with you the trends week on week. View last weeks results here.
General overview
As many treasurers have survived the first few months of the pandemic, they are now looking forwards as they re-plan the rest of the year. A key challenge is understanding how the easing of the lockdown will affect their business and that of their customers and suppliers. There is a variety of different general economic and also sector specific forecasts that range from a V to a U to a tick-mark. We have included forecasts from the WTO and the OECD in our COVID-19 hub to help build your own forecasts.
Hindsight is a wonderful thing and one message from some treasurers is that if they knew that CLBILS would be extended beyond the original £50m to £200m, many would have focused their attention on this and not on the CCFF programme which seems to take longer and be more expensive.
The CCFF scheme
As the scheme settles down we will include utilisation data from the Bank of England (BoE).
Taken from the BoE report, the following table provides some interesting insights.
The data shows that only 43% of applicants to the CCFF facility have currently drawn on this facility (down from 45% at 20 May).
This supports some of the conversations we’ve had with treasurers who have applied for the facility as a back-up to their existing financing arrangements. We know that some treasurers prefer to access their own private financing arrangements as it offers them greater flexibility.
It also confirms some conversations and our own liquidity survey that suggest that borrowing requirements may peak in a few months’ time once the furloughing has ceased, salary and redundancy costs start to take effect and business restructuring starts in earnest – before any customer receipts start again.
We are starting to hear from firms that have been able to access the CCFF programme; we provide anonymised feedback to the Bank of England. If you’d like to share your experiences, please drop an email to technical@treasurers.org.
Other Schemes
The tables below show the rate and extent of take up of the various funding schemes that have been made available:
Latest feedback from Treasurers
Banking:
Liquidity management
Quotes we have heard from treasurers include:
Update from the UK regulators
Views from across the world
As a member of the International Group of Treasury Associations, and the European Association of Corporate Treasurers and working with our colleagues in the US National Association of Corporate Treasurers we are keeping an eye on developments overseas.
Engaging with the treasury community
We welcome conversations with our members on:
Send an email to technical@treasurers.org and either James Winterton, Naresh Aggarwal or Sarah Boyce will be in touch with you.
If you have found any resources which you feel we should add to our COVID-19 site, please email us with details.
Naresh