UPDATE 1-Swiss govt doubles size of coronavirus loan scheme to $41 bln

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By John Revill

ZURICH, April 3 (Reuters) – The Swiss government is doubling the size of its coronavirus emergency loan scheme to 40 billion Swiss francs ($40.94 billion) after being flooded by requests for help by businesses, it said on Friday.

The government said it was expanding bridging loan guarantees from an initial 20 billion francs after banks made loans of 14.3 billion francs in the first few days of the scheme. So far more than 76,000 agreements have been made, the government said.

The Swiss death toll from the new coronavirus rose to 484 people from 432 people on Thursday, while the number of positive tests rose to 19,303.

Businesses have been clamouring for the loans to help them stay afloat as customers stay away or supply chain problems emerge. A string of big Swiss companies have issued profit warnings, while many firms have put staff on short-time work as the economy slowed.

The government had said this week it was considering expanding the scheme after receiving a flood of applications. On Friday it said the initial 20 billion francs allocated would likely be exhausted in the next few days.

The government asked parliament to approve the higher amount, with an extra 10 billion francs requested as a matter of urgency on April 7.

The loans, which are part of Switzerland’s largest ever economic aid package, come at low or zero interest.

Under the scheme being administered by hundreds of banks including heavyweights UBS and Credit Suisse, loans of up to 500,000 Swiss francs are fully secured by the government. Credits of up to 20 million are 85% secured.

The government said it believed the loans were not being abused, but it was also taking steps to prevent applicants from cheating the scheme. ($1 = 0.9770 Swiss francs) (Reporting by John Revill, editing by Michael Shields)

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