On 25 March 2020, there was published a letter from the Chancellor, the Governor of the Bank of England, and the CEO of the FCA to the CEOs of the UK banks on the subject of COVID-19 and bank lending.

In the letter HM Treasury refers to the economic measures that the Government has introduced in light of the COVID-19 pandemic and makes the point that it is vital that Government, the regulators and industry continue to act together to mitigate the longer lasting effects of COVID-19 on jobs, growth and the UK economy.

The letter concludes by stating that the priority for banks, building societies, Government and the financial authorities is to take all action necessary to ensure that the benefits of the economic measures are passed through to businesses and consumers. It adds that this will require a willingness to maintain and extend lending despite the uncertain economic conditions and that “firms whose business models were viable before this crisis remain viable once it is over.”