Two Chinese state-owned banks and Dutch bank ING are among a group of lenders who could play an important role in the stability of Thames Water, as its funding crisis deepens, according to new reports.
The banks are owed £190 million from a loan given to the water giant’s parent company, Kemble Water Finance, which expires at the end of the month.
The deadline could be extended after Thames Water said it would not be able to repay it.
ING, Bank of China, Industrial and Commercial Bank of China, and Allied Irish Banks are among the lenders behind the loan, according to new information reported by Sky News and the Financial Times.
It means they could take a stake in Thames Water if the loan is not repaid and Kemble is in default.
Thames Water’s crisis worsened last week when it said its investors had pulled a £500 million funding lifeline that was due to be paid at the end of April.
Some of that was understood to be earmarked to pay the Kemble loan.
Shareholders said the water regulator, Ofwat “has not been prepared to provide the necessary regulatory support for a business plan which ultimately addresses the issues that Thames Water faces”, after more than a year of negotiations.
“As a result, shareholders are not in a position to provide further funding to Thames Water,” the group said.
The group behind Thames Water is owned by a consortium of pension funds and sovereign wealth funds which already have links to China, as well as Canada and Abu Dhabi.
Both Ofwat and Thames Water sought to reassure customers that services would not be affected by the funding woes.
Thames Water serves 16 million households in London and the south-east of England.
Thames Water declined to comment on the information, and Kemble could not immediately be reached for comment.