Barclays boss Jes Staley has said that the government is prepared to go “well beyond” its initial £330bn coronavirus business rescue package, labelling its efforts so far “an extraordinary tsunami”.
Speaking to analysts this morning, Staley said: ‘£330bn was a first indicative number, but I think it’s pretty clear that they are willing to go well well beyond that.
“We shouldn’t underestimate the economic commitments that the government is making, and we need to partner with that”, he added.
Thus far, Barclays have given out £737m in coronavirus business interruption loans to 3,760 businesses in the UK, and are also the government’s commercial partner for the job retention furlough scheme.
Banks have come under criticism for not reacting fast enough to the crisis, with many calling on lenders to up the rate at which they process applications.
According to the latest available data, the number of coronavirus loans doubled last week to £2.8bn, but only around half of 36,000 applications have been approved.
Staley said that he was in constant conversation with authorities regarding how to develop the programmes:
“There’s a tremendous amount of dialogue between myself and the chancellor and the Bank of England, about how we evolve these programmes to make them more and more effective and more and more efficient.
“This is a very new frontier so it takes us a while to get there”, he added.
Yesterday HSBC boss Noel Quinn said that the approval rate for such loans would likely speed up after banks on Monday removed a requirement for small businesses to predict their future earnings.
“There’s been some adjustments to the criteria in the last few days… and therefore those should make it easier to process those transactions,” Quinn told City A.M.
“The primary issue was around scheme eligibility and setting up the process, that was something we had to react very quickly to”.
Thus far HSBC has approved around £600m in loans to 4,200 small businesses.
TheCityUK boss Miles Celic stepped in to defend banks over their lending record yesterday.
Speaking to City A.M. editor Christian May on City A.M’s daily City View podcast, Celic said banks were not “shirking their responsibilities”.
He added: “It was the taxpayer and the country that had to stand behind the banks [in 2008, whereas] this is an opportunity for banks and the financial sector to stand behind the country.”