* 15 Asian banks contribute to loan facility
* Gunvor says loan will help with Asian expansion
By Emma Farge
GENEVA, June 12 Cyprus-registered commodities
trader Gunvor said its Singapore branch had signed a $635
million loan agreement with mostly Asian banks, as trading
houses look for new sources of capital amid a retrenchment by
traditional European lenders.
European banks involved in commodity trade finance, such as
market leader BNP Paribas, have cut back lending,
under pressure from new rules requiring them to boost their
capital and from a shortage of dollar liquidity.
That has left a gap in the market for Asian banks.
Gunvor, which has major offices in Geneva and Singapore,
said on Tuesday the revolving credit loan facility would be used
to refinance existing debt and to finance working capital
Chief executive Torbjorn Tornqvist said the financing would
help the trader consolidate its position in Singapore where
commodities trading is growing, partly due to booming demand
from neighbouring China.
"By attracting such considerable confidence from local banks
in the Asia-Pacific region, our Singapore regional hub Gunvor
Singapore Pte Ltd has built a truly regional portfolio of
support for our growth strategy," he said.
The one-year facility was backed by 15 Asian banks including
China Development Bank as well as eight European and five Middle
Eastern banks, it said.
Gunvor, co-owned by Russian tycoon Gennady Timchenko, is
rapidly expanding its downstream business and has agreed to buy
two European refineries from insolvent refiner Petroplus.
The retrenchment of some European banks has made it harder
for small traders to gain access to credit although top
commodities traders have been able to raise capital via loan
"It's no surprise - Vitol, Mercuria and Trafigura are good
risk and they won't have trouble finding financing. However, the
cost of these financings may have increased. Money isn't that
cheap in today's environment," said a Geneva-based banker.
Rival commodities trader Mercuria said earlier in June it
had raised the equivalent of nearly $2 billion via two loan
(Reporting by Emma Farge; Editing by Mark Potter)