Airlines have been hit hard by the current COVID-19 crisis as their aircraft is now grounded at airports for the foreseeable future (blogged about by my colleague, Heidi Wagstaff in her "Fight" or "Flight" post).   

Today, the news reports that Virgin Atlantic is the latest airline to apply for a government loan to continue to support its operations and secure its future (Easyjet having also sought a bailout).  The loan is believed to be for £500m but, notably, will be backed by Sir Richard Branson personally.  Sir Branson has offered up his famous Necker Island as collateral for the loan, indicating that it could be mortgaged.

This happens as Virgin Australia (part owned by the Virgin group) collapses into administration in Australia.

Whilst his extensive wealth will doubtless mean that, even if the security is relied upon, his finances won't be too hard hit (a £500m security vs a $4bn estate doesn't appear to be too risky for him!) this does raise the question as to how many other directors and business owners are taking steps to personally secure the future of their business. There is, of course, the availability (to some) of the Coronavirus Business Interruption Loan, but for others a passion for their business or confidence in future success, will lead to personal investment (and associated risk).

The question remains - will we see a wave of personal financial difficulties and associated insolvency procedures linked to business investment in the near future? Bankruptcy (and most other individual insolvency procedures) would leave scars in an individual's financial health for years to come, long after the COVID-19 pandemic has passed.