Your browser is no longer supported. For the best experience of this website, please upgrade to a newer version or another browser.

Your browser appears to have cookies disabled. For the best experience of this website, please enable cookies in your browser

We'll assume we have your consent to use cookies, for example so you won't need to log in each time you visit our site.
Learn more

Interest rate ‘threat’ for struggling retailers

An increase in interest rates this year may threaten up to 400 high street retailers, it has been reported.

The Times has said New Look, Mothercare and Debenhams were among 392 retailers named in a study by Company Watch that suggested that they are 25 times more likely to suffer financial distress than other retailers.

Jo Kettner, chief executive of Company Watch, noted that much of the risk came from rising interest rates: “It’s no secret that the bank base rates are set to rise this year at least once and maybe twice. For many of the household names that are loss-making and already in our warning area, a rise in the cost of debt could well be the final straw.”

The study analysed 1,600 retailers with assets of more than £5m. Hobbs, Thomas Pink, Mamas & Papas, Missguided and Crew Clothing were all also found to be loss making on a pre-tax statutory basis. The study warned that a doubling of base rates would lead to a 4% increase in the numbers of loss-making retailers.

Have your say

You must sign in to make a comment

Please remember that the submission of any material is governed by our Terms and Conditions and by submitting material you confirm your agreement to these Terms and Conditions. Links may be included in your comments but HTML is not permitted.