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2018 corporate debt report: UK business confidence remains resilient

04 April 2018 | UK
Guides – By Kristen Roberts, Partner, Amy Geddes, Partner, Elliot Beard, Senior Associate, Nick May, Partner, Robert Moore, Partner, Isaac Zailer, Partner

UK business confidence remains resilient, with our new survey showing 80% of companies plan to maintain or increase their spending this year.

For a fifth consecutive year, we have surveyed and interviewed CFOs, treasurers and other senior finance professionals at circa 60 major UK listed corporates for our annual Corporate Debt Finance and Treasury Report.

This year's findings have been featured in leading publications, including the Wall Street Journal and City AM.

Key conclusions include:

  • Business confidence remains robust. Across all areas of investment at least 80% of respondents projected the same or higher levels of investment than in 2017.
  • Noting that this research was undertaken prior to the breakthrough on the potential transition arrangements, respondents overwhelmingly reported that Brexit was not affecting their spending plans.
  • Bank lending remains the cornerstone for corporate debt raising with increasing focus by corporates on their bank relationships.
  • Corporates are likely to maintain or increase cash reserves in 2018.
  • Compared to 2017, respondents were marginally more pessimistic about the downside risks of Brexit although this is projected to reduce over time. There was significantly greater concern about the negative business impact of a ‘hard’ Brexit.
  • The end state is too uncertain for corporates to meaningfully finalise/implement Brexit contingency plans.
  • Brexit is not affecting the availability of treasury products or the terms on which they are available.

Corporate debt partner Kristen Roberts said:

"Business confidence and investment remains robust and corporates are taking the uncertainty caused by Brexit in their stride; Brexit will however play an increasing role in determining the timing of debt raisings planned over the short to medium term.”

We hope you find these results informative and would like to thank those who participated in our research. In particular, we are grateful to those who took part in our follow-up interviews to discuss the survey results.

Please contact Kristen Roberts if you have any comments on the report or would like to discuss any of the issues raised.

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