(Updates with comment from Standard Chartered)
HONG KONG/SYDNEY, June 5 Standard Chartered
has suspended new metal financing to some customers in
China, three sources familiar with the matter said, as banks and
trading houses review their exposure after a probe into trade
financing at the port of Qingdao.
A Standard Chartered spokeswoman said the bank was reviewing
financing to a small number of its clients.
"Specific to this incident, Standard Chartered is reviewing
metals financing to a small number of companies in China," she
said. The bank earlier said it was monitoring the situation in
A client of Standard Chartered was told by the bank that it
had temporarily stopped giving "inventory financing" to new
deals. The bank would not roll over existing deals when they
expired, the Standard Chartered client said.
Another source based in Singapore, with knowledge of the
situation, also said the bank had halted financing deals.
"It's official. Right now they don't renew financing
deals...and stop financing new deals," said the source, who
trades physical copper and ships it to China.
At least one other Western bank with operations in China is
reviewing its exposure to copper and aluminium financing, a
source with direct knowledge said.
Concern over the situation has extended to domestic banks. A
Chinese state-owned bank had sent a team from head office to
Qingdao to investigate trade financing problems, a source with
direct knowledge of the situation said.
(Reporting by Melanie Burton in Sydney, and Polly Yam, Xiaowen
Bi and Hongmei Zhao in Hong Kong; Editing by Ed Davies and Mike