Lloyds pulls out of £1bn finance deal to help BP buy Russian oil
Tuesday 03 June 2014
Lloyds, the bank part-owned by the Government, has withdrawn from a trade finance deal worth between £895m and £1.2bn involving the Russian oil company Rosneft, in a development that highlights the growing unease among Western banks in funding Russian deals.
Lloyds, along with Deutsche Bank, HSBC and Bank of China, was a mandated lead arranger (MLA) on the loan to finance BP's purchase of crude oil and refined products from Rosneft.
The loan would have been similar to previous deals Rosneft had with BP or the trading houses Glencore and Vitol but, according to banking sources close to the talks, Lloyds decided to walk away after several weeks of hesitation.
The bank is 25 per cent-owned by the Government, which has repeatedly condemned Russia for its actions in Crimea and eastern Ukraine. Rosneft's powerful boss Igor Sechin, a close ally of Vladimir Putin, was hit by US sanctions as part of a broader move to punish Russia for the annexation of the Crimean peninsula.
“Lloyds's decision to leave the deal is because it does not want to embarrass the Government, considering the current political situation with Russia,” said one of the bankers. “I think it was scared of going upstairs to ask permission.” BP, Rosneft and Lloyds all declined to comment.
It is not yet clear if another bank will replace Lloyds as an MLA. The loan is supported by several lenders including Japanese, European and Chinese banks. Rosneft and BP, via a specially created company, are trying to complete the financing, which is backed by Rosneft's future oil production.
- 1 East 17 bandmember Brian Harvey in 'very desperate situation’
- 2 Is this bridge haunted by the ghost of nu rave?
- 3 Woman filmed launching racist tirade against men on the Tube for speaking in 'own lingo'
- 4 The West has it totally wrong on Lee Kuan Yew
- 5 Scientists have discovered a simple way to cook rice that dramatically cuts the calories
East 17 bandmember Brian Harvey in 'very desperate situation’
Vladimir Putin says Russia will fight for the right of Palestinians to their own state
Is this bridge haunted by the ghost of nu rave?
Woman filmed launching racist tirade against men on the Tube for speaking in 'own lingo'
Saudi Arabia says it won't rule out building nuclear weapons
Ukip supporters are 55 or older, white and socially conservative, finds British Social Attitudes Report
JK Rowling responds to fan tweeting she 'can't see' Dumbledore being gay
Jeremy Clarkson sacked live: Alan Yentob 'wouldn't rule out' ex Top Gear host's BBC return
David Cameron calls Labour 'hopeless, sneering socialists' while announcing 7-day NHS plans
The West has it totally wrong on Lee Kuan Yew
Revealed: Putin's army of pro-Kremlin bloggers
iJobs Money & Business
Negotiable: Recruitment Genius: To provide a prompt, friendly and efficient se...
Negotiable: Recruitment Genius: You will be the first point of contact for all...
£18000 - £24000 per annum + benefits: Ashdown Group: HR, Payroll & Benefits Of...
£35000 - £38000 per annum + benefits : Ashdown Group: A highly successful, int...