Nedbank, Standard Profit From Europe’s Distress, Grow Mine Loans
February 08, 2012, 11:48 PM ESTBy Carli Lourens
Feb. 8 (Bloomberg) -- Standard Bank Group Ltd., the largest lender based in Africa, and Nedbank Capital are profiting from European rivals’ distress by boosting loans for mining and oil.
Standard Bank may increase loans from last year’s “already strong” level of more than $1 billion, Rajat Kohli, global head of mining and metals, said in an interview. Nedbank may double oil and gas lending, and seeks to offer about $500 million for mining and oil, Joint Mining Head Peter van Kerckhoven said.
“We’ve in essence stepped into a bit of a gap in the market that’s been left by European banks,” Van Kerckhoven said in an interview in Cape Town today. “We’re open for business when many in Europe are tightening their belts. Our balance sheets are whole and our capital ratios are good.”
Europe’s lenders are struggling as the regional debt crisis enters its third year. French banks Societe Generale SA, BNP Paribas SA and Credit Agricole SA are cutting corporate and investment banking jobs, putting at risk Paris’s role as a center for project finance and other corporate lending.
“The eurozone crisis has forced some of the European banks to look inwards, to really focus their energies on resolving balance and liquidity issues,” Kohli said today. “Some of these banks are not as prevalent in funding and other situations, including in Africa in mining.”
Nedbank said Feb. 6 per-share earnings for the year ended December probably grew as much as 28 percent. The bank’s parent is up 20 percent in Johannesburg trading in the past six months as Standard Bank rose 17 percent, while Societe Generale fell 12 percent in Paris in the period and BNP Paribas slid 10 percent.
Nedbank Capital is the Johannesburg-based investment banking unit of Nedbank Group, controlled by Old Mutual Plc.
The bank’s new oil and gas unit’s “asset base has grown by hundreds of millions of dollars in the past year,” said Van Kerckhoven. The company agreed to finance oil and gas projects in Nigeria and Angola last year, helping the unit formed last year exceed expectations, he said.
--Editors: Tony Barrett, Randall Hackley
To contact the reporter on this story: Carli Lourens in Johannesburg at clourens@bloomberg.net
To contact the editor responsible for this story: John Viljoen at jviljoen@bloomberg.net
