Defence firms that supply vital kit for Armed Forces blocked from UK banks

Defence firms that supply vital kit for Armed Forces blocked from UK banks



Posted by theipaper

4 comments

  1. Cutting edge British defence companies are being refused bank accounts by some of the UK’s biggest financial institutions over ethical concerns, *The i Paper* can reveal.

    One company that makes critical armoured vehicles used by the British military, including by Special Forces in Afghanistan and Iraq, was turned down by [HSBC](https://inews.co.uk/topic/hsbc?srsltid=AfmBOooy3nlVYFj0bMuq2k2J5tRIlKTTas2oHSry8k1Mg6JhDOz2JgRd&ico=in-line_link) for a bank account whilst others have struggled to get loans or investment for future manufacturing. Often the reasons for a bank refusing to offer facilities are not given but can be linked to involvement in potential “lethal” activities or not being “green” enough.

    The growing concern for some in the defence industry , who fear they are being “debanked”, comes as the government is hoping to turbocharge the sector in the wake of the [Trump administration pulling back from supporting European securit](https://inews.co.uk/news/uk-security-services-concern-over-intelligence-sharing-with-trump-administration-3559414?ico=in-line_link)y.

    The government has recently promised to increase [defence spending to 2.5 per cent of GDP raising funding by £6bn a year](https://inews.co.uk/news/politics/starmer-labour-will-increase-defence-spending-to-2-5-and-boost-nuclear-deterrent-3002947?ico=in-line_link). Chancellor Rachel Reeves is keen that small and medium-sized defence manufacturing firms help drive economic growth.

    SC Group, which was previously known as Supacat, and has won contracts with the Ministry of Defence worth tens of millions of pounds, has said it has struggled to get any investments or loans because it isn’t “green”.

    SC Chief Executive Nicholas Ames claims it was almost impossible to arrange a commercial loan to invest in future manufacturing in Britain because lenders were only looking to finance green companies.

    Ames alleges it was almost impossible to get any financing unless a company provided “dual use” products, which can be used for both civilian and military use.

    He said: “Every time we [approach] banks, debt funds or equity funds, they’re all going: ‘we’ve all moved into [ethical investing], we’ve all moved into the green funds. Come back to us with something green.’”

    A number of major defence companies have told *The i Paper* of the problems they are facing being “debanked” by major institutions.

    The defence industry has long complained about so-called [environment, sustainabily and governance](https://inews.co.uk/inews-lifestyle/money/investing/new-generation-investors-want-to-make-their-money-work-for-the-planet-the-trend-towards-esg-1549644?ico=in-line_link) (ESG) red-tape that critics say guide investors away from the British defence sector.

  2. This has been a thing for a while now for everyone especially politicians and their families.

  4. ‘Turned down by HSBC’ no surprise there, they absolutely only exist in the UK to fleece!

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