The UK has directed its export finance agency to expand its Ukraine cover by £3 billion, while its 2026 Budget also plans to widen bank-backed trade finance for British exporters.
Business Secretary Jonathan Reynolds instructed UK Export Finance (UKEF) on Oct. 25 to increase the Ukraine limit from £3.5 billion to £6.5 billion. The move is part of the broader Ukraine support package in the Budget. UKEF’s assessment says HM Treasury consent is required before the direction can be implemented and additional cover provided.
UKEF Chief Executive Tim Reid said in an Oct. 23 assessment letter that the agency was close to its existing limit. He described default and expected-loss risks as “exceptionally high” and said he could not conclude that the increase represented value for money. Reynolds said he weighed the financial risks against national security, foreign policy and economic benefits.
UKEF’s assessment says the Ukraine support falls outside its normal underwriting criteria and is provided through its National Interest Account. Reid’s letter said UKEF expected to report a substantial net operating deficit for fiscal 2025-26, which ended March 31. It gave no projected amount and cited Ukraine support as the driver. UKEF also identified possible future debt restructuring and losses to the Exchequer as risks.
Separately, the Budget says eligibility for the General Export Facility (GEF) will expand to new exporters. Participating lenders will be able to provide up to £15 million under the scheme without transaction-specific UKEF approval, up from £10 million. UKEF’s partial guarantees to banks support exporter trade finance, including trade loans, bonds and letters of credit. UKEF has not announced when the expanded eligibility or lender authority will take effect.
