Peel Hotels has secured a £9.9 million five-year loan to cut future financial charges.

The facility by the company, which owns nine UK hotels in cities including Bournemouth, Bradford, Leeds, Newcastle and Nottingham, was secured with Allied Irish Bank.

It will be used to repay existing facilities with the Royal Bank of Scotland as well as the remaining balances of the director’s loans and loan notes to reduce the company’s debt servicing obligations.

Savings in the 2018-19 financial year are estimated to be not less than £160,000.

“The revised financing structure will result in a significant reduction in financial charges going forward,” the company said.

Chairman Robert Peel said: “I am delighted that we have closed our new financing arrangements with Allied Irish Bank.

“We expect this new facility to provide significant savings in the costs of finance and to improve our cash flow and reduce our net debt.”