COVID-19 Corporate Financing Facility

Support provided by British Business Bank

What does this involve?

The COVID-19 Corporate Financing Facility (CCFF) is a lending facility for large businesses that play a significant role in the UK economy. It is designed to help them manage short-term cash flow issues and continue to pay wages and suppliers during the coronavirus crisis.

It is open to businesses that make a material contribution to the economy and is administered through commercial lenders.

Under the scheme, the Bank of England will buy short-term debt from eligible companies which are experiencing an unexpected funding squeeze due to the pandemic, but were otherwise financially sound.

The programme will run for 12 months, or as long as is needed to relieve the cash flow pressures on eligible large businesses.

Am I eligible?

A company is eligible if it is classed as making a significant contribution to the economy. This could include:

  • UK-incorporated companies (including those with foreign-incorporated parents and with a genuine business in the UK)
  • companies with significant employment in the UK
  • firms with their headquarters in the UK
  • companies that generate significant revenue in the UK
  • companies with a large customer base in the UK
  • companies with many operating sites in the UK

The company must also have been financially sound before the COVID-19 crisis. This usually means having a credit rating of investment grade or equivalent as of 1 March 2020.

Companies from all sectors are eligible to apply, except for finance institutions (banks, building societies, insurance companies and other financial sector businesses).

Large housing associations are also eligible, provided they meet the criteria and are assessed as V1 grade for viability by the Regulator for Social Housing.

What does this cost?

The facility will offer financing terms similar to those available just before the COVID crisis began.

For primary market purchases, the Bank will purchase securities at a spread above a reference rate, based on the current sterling overnight index swap (OIS) rate. The respective reference OIS rate will be determined at 09:45 on the day of the operation.

For secondary market purchases, the Bank will purchase commercial paper at the lower of amortised cost from the issue price and the price as given by the method used for primary market purchases as set out above. The Bank will apply an additional small fee (currently set at 5bps and subject to review) for use of the secondary facility, payable separately.

Who is this for?

The CCFF scheme is for large companies which make a material contribution to the UK economy, and which are experiencing short-term credit issues due to the COVID-19 crisis.

How long does this take?

After they receive your application, the Bank of England will aim to confirm your eligibility as soon as possible. Applications are often slowed down because of insufficient information to prove to the Bank that the person signing the documentation on behalf of your company is authorised to do so. So, prepare for this before you apply. 

For confirmations received before 4pm on a working day, you can sell your commercial paper to the Bank of England through your bank the next working day.

Important information

Companies can still be eligible even if they have not previously issued commercial paper. If your business has not issued commercial paper before, contact your bank for advice.

If your bank does not issue commercial paper, UK Finance will provide a list of banks that are able to assist. [https://www.ukfinance.org.uk/test-page-covid-19-commercial-financing-facilities]

The CCFF will only purchase individual securities with a minimum value of £1 million nominal. Offers must be rounded to the closest £0.1 million.

Next steps

Visit the Bank of England website for more information.

Support provided by British Business Bank

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