U.K. Banks’ Talks on Shared Covid Debt Collector Stall, FT Says
(Bloomberg) -- Discussions among U.K. banks to establish a shared debt collector for unpaid payments on Covid loans have stalled, the Financial Times reported, citing people familiar with the discussions.
Lobbying group UK Finance was leading talks on a shared entity but several of the U.K.’s biggest banks such as HSBC Holdings Plc and Lloyds Banking Group Plc have soured on the idea, according to the report.
Large banks were disappointed by the scope of the shared utility, according to the report. The lenders were initially interested as a means to shield themselves from poor public relations for pursuing repayment from small businesses that are struggling, it said.
Bank executives also want to show sufficient effort to collect the loans before resorting to the 100% guarantee on losses from the U.K. government, according to the Financial Times.
A spokeswoman for UK Finance declined to comment to the Financial Times.
©2021 Bloomberg L.P.