- Hey gang, I wanna talk to you
about what I think is
gonna happen to banks,
and how they're gonna lend
to businesses, to consumers,
for mortgages over the
next six to 12 months,
and it is really important that
you're thinking about this,
because I think it's
having a detrimental effect
on how the country goes through
what is going to be a
very deep, dark recession.
However, like always,
I always think there's huge opportunities
for entrepreneurs and business owners
that wanna take their
business to the next level.
There's people just not
wanting to be in business.
I always call it the "Three Es."
People are losing their
energy, enthusiasm, and effort
for their business.
Here's something though.
I wanna give you some real
context and facts on this.
I'm trying to buy this zoo, farm thing.
It's freehold.
I've got the deposit.
I wanna put a 30% deposit
down and get a 70% mortgage.
Now I've got it over the line,
I'm not worried about that,
but it's way more challenging
than it would have been six months ago,
and I'll tell you for why.
I've spoken to, and I
don't wanna name the banks,
but I've spoken to, say
there's 10 big banks in the UK,
ranging from HSBC, NatWest,
RBS, Barclays, Virgin Money,
those sort of big banks.
At the moment, they're
doing so many CBILS,
Coronavirus Business
Interruption Loan Scheme stuff,
and BBBLS,
Business Bounce Back Loans,
that they're just shoring
out cash all the time,
and people are taking this money up.
Now I spoke to someone very senior
in one of those big banks
that I mentioned earlier,
and they said that they
have lent more money
in the last two months,
than the whole of the
last two years combined.
Let me just give you that
fact, just one more time,
'cause I think that is astounding.
They have lent more money
in the last two months
than in the last two years combined.
And so what they're doing now
is they're trying to shore
up their balance sheet.
Now they did also say that
what customers are doing,
'cause they've got view of accounts,
they're taking their 50,000
pounds bounce back loan
and popping it in their current account,
so it still stands within
the same bank, if you like,
but they can't use that cash,
so the cash is staying within the bank,
but it's staying in clients' accounts,
as us business owners,
and I've been advising
business owners to do this,
we're creating war chests,
in case there's problems
arise from a second wave,
et cetera, et cetera,
but now the banks
are starting to shore
up their balance sheets,
'cause they know some of this CBIL stuff
and this BBBL stuff's gonna go wrong.
You know, they're saying the
government's 100% guaranteed,
and they're gonna give
them 80% of the money back,
or, 100% of the bounce
back loan money back,
but here's the thing.
I was speaking to this
senior bank manager,
and he said to me,
"The thing is, James, they used to do
this Enterprise Finance
Guarantee loan scheme,
and when they went wrong,
it was always hard to get the
money out of the government.
They didn't just pay it back,
and you always had to prove the point,
and I think the banks are aware of this.
Although the government are
saying they're securing it,
it's still the banks
lending their own money.
Now, where does that leave
you, as a business owner?
And also, as we're going
through this, comment below,
and let me know if you've
taken a bounce back loan,
if you've taken a CBILS loan,
what you're planning on doing with it.
Are you just keeping it in your
bank to use as a war chest,
or are you using it to
invest to grow your business?
I'd love to know, hit the comments below.
Well anyway, let's go back.
So he was saying to me,
"We're gonna have to shore
up our balance sheet,
because it's our money,
and we know that the
CBILS loans, and the,"
sorry, the Enterprise
Balance Guarantee loans
that they used to use years ago,
that it was hard to get the
money outta the bank, so,
"It's our money that we're still lending,
and so we're not necessarily
doing any new lending.
We say that we are, but
we're not really doing it."
So where does this leave
it for your business?
I think, over the next 12 to 18 months,
it's going to be very
difficult to borrow money
just for normal, bog-standard stuff,
unless the Bank of
England and the Government
say that you don't have to have
so much liquidity in your balance sheet.
For example, for every pound they lend,
they might have to keep three
pound on their balance sheet.
They might say to them, "For
every pound you lend now,
you need to only keep one pound 20."
That would make them
have more cash to lend.
But at the moment, they
haven't been told that
into the depth that they need to be told,
to got out and do standard stuff.
So what have I done?
Well I've rang 20 different banks,
and I've got two or three
that I've never done
any relationships with,
and hopefully they're
gonna do the deal for me.
So I thought I'd just lend
that little piece of advice
to you on YouTube.
If you're watching me on LinkedIn,
what do you think about this?
Hit it in the comments below.
If you are on YouTube, please
subscribe to the channel.
Are you trying to do just
normal business stuff?
I'm serious about growing
our business right now.
I'm looking at the amazing deals
that I really wanna get over the line,
but I'm looking at ways of
doing delayed completion,
so we're exchanging with
a delayed completion.
I'm hoping that the mortgage world
is gonna be better in 18 months time
on freehold commercial property.
We're only looking at
stuff that we owner-occupy,
so where we're gonna take the business
and trade our business in there.
So, try and think creatively
if you can't get deals over the line.
Think about doing delayed completions,
that's a way of getting in there,
you maybe have to pay a rent
and then delay completion on
commercial property purchases.
If you're investing in the
business, ask your suppliers,
maybe they can do supply finance.
Start lobbying your
MPs to get behind this,
that the government can
prove banks to lend money,
because this is some tough times
that we're going in in the next 18 months.
But, observe the masses
and do the opposite,
that's what I think.
Yeah, there we go, that's
my little view on this.
I just wanted to dive
in there and say that.
And don't forget, guys,
if you're serious about
growing a business,
you can try my Entrepreneurs University.
Here is the soiree for it.
And you can try it free
for the next 14 days.
You go to Jamessinclair.net,
or there's a link in
the video description,
where we can help grow your business.
Click this video here, if
you're watching on YouTube,
to help grow your business,
and subscribe to the
channel by clicking here,
and I'll see you in the next
video, bonjour, bye-bye.
(mellow music)
