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Defence companies face uphill battle for financing
The Observer
|June 29, 2025
Financing for defence companies by the UK’s four largest banks ~ Barclays, Lloyds, NatWest and HSBC ~ has risen by a fifth since 2022, according to data shared with The Observer.
In an age of insecurity, the rise to £10.8bn in 2024 is hardly unexpected. More surprising is how tricky it has been to get loans signed off.
Banks have been caught between groups protesting against such investments, defence companies claiming to be unfairly “debanked” and politicians calling for defence lending to be classified as “ethical” or ESG (environmental, social and governance) in the national interest. As the former chair of BAE Systems, Roger Carr, has said, it has become vital to distinguish between “highly regulated, ethically led and government-backed defence contractors” and “freewheeling arms dealers”. But how that is done is still being figured out.
This story is from the June 29, 2025 edition of The Observer.
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