Stef’s market update – February 2026 – strong deal flow and cautious optimism ahead of the Spring Statement

February has felt much like January – busy, competitive and full of activity. We’ve seen a real flurry of deals across the market and strong appetite from lenders. High street banks are competing well, which is good news for clients as pricing sharpens and terms improve.

Refinancing remains a key theme. Many businesses are reviewing debt put in place over the past few years and replacing it with cheaper, better-structured facilities. Lenders are supporting firms with solid cash flow forecasts and healthy order books, which is encouraging.

We are also seeing more pre-pack transactions coming through. It has been a tough time for certain sectors, but there are good businesses that will come out the other side stronger. We have several such transactions in progress at present.

Unsecured loans and invoice finance continue to be popular. It was particularly pleasing to welcome a number of new-to-invoice-finance clients in January. For many, it is the first time they have used it and they quickly see how useful it can be in supporting working capital.

As always, a huge thank you to our lending panel for working hard and continuing to deliver for us and our clients.

Looking ahead to the Spring Statement

The big question is whether taxes will rise further in the Spring Statement 2026. From the autumn budget, we already know that pressure is building quietly in certain areas.

Inflation sits at 3% and is edging down towards the 2% target, with hopes it settles by the summer. Food prices are still climbing, now at 3.6%. Fuel duty may rise later in the year, which would feed through to costs for both households and businesses.

Interest rates stand at 3.75% and may fall again. Unemployment has crept up to 5.2%, with younger people feeling it most. Growth remains subdued at 0.1% across the last two quarters of 2025.

The picture is mixed. There are areas of strain, yet lending appetite is still there and competition remains healthy.

Before the Spring Statement lands, there are practical steps individuals can take. Annual allowances such as ISAs, capital gains tax relief and pension contributions are worth reviewing. Gifting assets, setting up trusts or considering whole life cover may also help with longer term planning. It is always wise to speak to a trusted independent financial adviser before making decisions.

We will watch this space closely and share further thoughts once details are confirmed.