Sir Keir Starmer has made a commitment to increase defense spending, but there is concern over British arms manufacturers relying heavily on foreign banks, according to a warning from a former defense secretary. Data from Dealogic reveals that Lloyds, Barclays, HSBC, and NatWest, the main UK lenders, only assisted in raising $13 billion of the $51 billion in debt funding for the British defense sector in the past decade. In contrast, US and European banks raised $17 billion and $11 billion respectively, while Canadian and Asian banks contributed $4.5 billion and $4.7 billion.

This situation has raised alarms among policymakers, especially in light of calls for the UK defense sector to be more self-sufficient following President Donald Trump's pledge to cease supporting Europe's military. Although Sir Keir Starmer has promised to increase defense spending, many Labour MPs are urging the financial sector to do more to back the British Armed Forces.

An open letter penned by Labour’s Alex Baker and Luke Charters, signed by over 100 MPs and peers, called for pension funds to allocate more investments to the weapons industry. Banks also play a crucial role by assisting suppliers in borrowing money through loan packages sold to pension funds and sovereign wealth investors.

Former defense secretary Grant Shapps criticized British banks for lagging behind global counterparts in supporting UK defense manufacturers. He emphasized the need for UK banks to support the defense sector to reduce reliance on foreign institutions for national security. Data from Dealogic shows that between 2015 and 2025, American banks like Citigroup, Bank of America, JP Morgan, and Goldman Sachs were among the top bookrunners for raising debt for UK defense companies, with BNP Paribas and Royal Bank of Canada performing better than HSBC, Barclays, and NatWest.

Comparatively, US and European domestic lenders have played a more significant role in supporting their respective military infrastructures. The American military receives three-quarters of its debt funding from Wall Street, while European banks contribute to half of the funds raised by EU defense suppliers. In the US, the top three bookrunners for the defense sector are American banks, while in Europe, they are Italian and French banks.