ARTICLE
15 July 2024

The New UK National Wealth Fund: A Change Of Focus For The British Business Bank?

M
Macfarlanes LLP

Contributor

We are a distinctive law firm, combining expertise, agility, and a client-centric culture to address the most challenging legal demands and foster innovation. Our firm is structured around the needs of our clients, with whom we build long-lasting relationships, tackling complex issues in key practice areas.

Our approach is focused and deliberate. We assist clients with major transactions, including M&A, real estate, and financial products; handle significant litigation and investigations; and provide comprehensive private capital advice, particularly through our leading private client practice.

With offices in London and Brussels, and a strong international network, we collaborate with top lawyers globally to deliver the highest level of service. Our firm’s human-sized culture emphasizes long-term careers, fostering a cohesive, entrepreneurial environment where every team member can thrive.

The UK government plans to create a National Wealth Fund, incorporating the UK Infrastructure Bank and British Business Bank, focusing on decarbonisation investments and reforming BBB to mobilize institutional capital for low-carbon technologies.
United Kingdom Finance and Banking

The Government earlier this week announced its intention to establish a National Wealth Fund (NWF).The plan is for two existing public finance institutions – the UK Infrastructure Bank and the British Business Bank (BBB) – to operate under the NWF umbrella, with a renewed focus on investments in decarbonisation technologies.

BBB has been a significant investor over the last decade in private funds investing in or lending to UK SMEs. Following the Government announcement, the Financial Times reported the Chancellor, Rachel Reeves, as saying that the creation of the NWF would mean reforms to BBB, so that it mobilises institutional capital "towards low-carbon investments".

For now, there is little detail on how this will be achieved, but a reasonable assumption would be that some of this new allocation of capital will be for funds investing in, or providing finance to, portfolio companies developing low-carbon technologies. But of particular interest to the UK SME funding ecosystem will be what this means for BBB's existing and future allocations to the sector. More details are expected ahead of the government's international investment summit, scheduled for the Autumn of this year.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Mondaq uses cookies on this website. By using our website you agree to our use of cookies as set out in our Privacy Policy.

Learn More