Business Finance: Banks

What discussions he has had with the Welsh Government on the comparative effectiveness of the (a) Development Bank of Wales and (b) high street banks in providing finance to business in Wales during the covid-19 outbreak.

High street banks have been at the forefront of lending to firms impacted by covid-19. They have provided support to Welsh firms through more than £1.1 billion-worth of loans under the Government’s bounce back loan scheme and £300 million of loans under the Government’s coronavirus business interruption loan scheme. There has also been an additional £100 million of lending through the Development Bank of Wales, which has been a useful contribution.

Let us head over to New York with Geraint Davies.

Thank you very much from over here in Wales.

The Development Bank of Wales has been found by the Welsh Affairs Committee to be much more effective in the delivery of coronavirus loans to business than high street banks, which have been found to be unresponsive, delayed and risk-averse, and not to understand local businesses. Will the Secretary of State and the Minister impress on the Chancellor the need to provide more funding for the Development Bank of Wales, and to import this excellent idea into England to help all British business?

I suppose it would not come as a great surprise to the hon. Gentleman, or to anyone who understands economics, as he does, that a high street bank is always going to be slightly more risk-averse than a bank backed by the UK Treasury. None the less, I draw the hon. Gentleman’s attention to the figures I gave earlier, which show that around £1.4 billion has been lent to businesses in Wales via high street banks utilising Government schemes, and £100 million has come via the Development Bank of Wales. This is not some sort of competition; we welcome every single pound that has been lent to Welsh businesses, no matter where it has come from.