Business leader goes abroad for loan
Comments |
by business editor Trevor Sturgess
UK banks claim to be lending more to business, but a Medway
firm had to wait so long for a decision that it switched to a
foreign lender to secure a takeover deal.
When Scotline, a Medway shipping and timber firm, asked Lloyds
Banking Group for a modest loan to help fund the purchase of
neighbouring wharf business Transit Medway from R Swain, managing
director Peter Millatt expected a quick decision.
After all, it had been a Lloyds TSB Bank customer for 30 years.
And the bailed-out bank - now 41 per cent owned by the UK taxpayer
- has repeatedly said it was "business as usual".
"This deal should have gone through last year," Mr Millatt said.
"But we could not find anyone to make a decision on lending. They
kept coming up with more questions and wouldn't find anyone to make
a positive decision. It was a total shambles. We weren't asking for
a lot of money.
"The percentage loan was very low and they couldn't take a
decision. We were in a strong position to do the deal."
Mr Millatt feared the procrastination would cost him the deal
and approached Swedish bank Handelsbanken. "They gave us a very
quick response and the deal was done."
Mr Millatt said: "They're going back to the old traditional form
of meeting a manager. He came round and looked at the site. All the
time we were talking to Lloyds, they never once asked to come and
have a look at the site we were looking to buy."
A spokesman for Lloyds Banking Group said: "We are a responsible
lender, and as such we need to ensure that we have all the
necessary information to hand before making any decision to lend to
a customer.
"In the process of looking at this customer's borrowing request
we needed to ask a series of questions about his business. This is
absolutely standard practice and we made sure that the customer was
fully aware at every stage of the process.
"Whilst we do accept that our decision took slightly longer than
we had hoped, we did agree to lend this customer the full amount he
requested.
"We made an offer to him 24 November, some weeks before he chose
to move to another provider."
Tuesday, March 08 2011
The KM Group does not moderate comments.
Please click here for our house rules.