U.K.’s Sunak Asks Hedge-Fund Colleagues for Advice, Times Says
U.K. Chancellor of the Exchequer Rishi Sunak is seeking advice from former banking and hedge fund colleagues as the government grapples with the economic impact of the coronavirus pandemic, the Times of London reported.
Treasury officials were asked to pass publicly available information to Sheridan so he could build a financial model for the government’s business loan program, the Times said, citing unnamed sources. This caused some friction among officials resistant to outside input, according to the paper.
Richard Sharp, a former Goldman Sachs Group Inc. banker and Sunak’s former boss, has been formally appointed to advise the Treasury, the Times said. One of his focuses will also be the loan plan, which has come under scrutiny after reports showed very few companies have successfully managed to access it.
The program, which began at the end of March, will facilitate emergency loans to companies with less than 45 million pounds ($56.2 million) in annual sales by guaranteeing 80% of the debt for lenders. Borrowers don’t have to pay interest or fees for 12 months and the loans will be capped at 5 million pounds and six-year terms.
It’s not unusual for governments to call on outside help in financial crises, the Times said. During the 2008 crash, the then-Labour government asked bankers for guidance as they weathered the fall-out.
©2020 Bloomberg L.P.