Lloyds Fin Expanding Global Unit Activities

Lloyds Finance is expanding the scope of activities of its international division - it plans to act as an agent to Indian buyers who want to buy ships from overseas parties. It is also entering the inter-bank forex broking sector and has recently begun arranging finance for low cost dollar credit to African commodity exporters.

Talking to Business Standard about the future plans of the companys international banking division, Mohan Bhonsle, vice-president, international division, Lloyds Finance, said the company is negotiating with two London-based banks. Under the scheme, the company will identify the ship buyer, the country of purchase and the appropriate bank which will finance the deal.

 

The size of the Indian ship market is around $400 million per year and hence very attractive. Lloyds claims it will be the first Indian company to start a service of this nature.

The company has also obtained preliminary approval for inter-bank broking from the Foreign Exchange Dealers Association of India and is awaiting final approval. Meanwhile, Lloyds is setting up the requisite infrastructure which includes six hotlines with banks, telex and trained dealers.

It is finalising deals with a licenced trader and plans to start operations in its Mumbai office within three months. As of now, the divisions main activities comprise forex exposure management.

It recently obtained a mandate for VIP Industries for management of an exposure of $17 million including an external commercial borrowing (ECB) of $3 million. Lloyds has also signed the mandate for Krishna Filament for $3 million, and Singhal Swaroop. It has also completed the ECB formalities for National Standard Duncan, a Calcutta-based company.

The company has recently begun arranging low-cost dollar credit for commodity exporters in Africa. Since the interest rate in Africa is very high, the scheme is picking up fast. Lloyds Finance has appointed an African trading company which has identified traders in several countries including Uganda, Zaire, Kenya and South Africa. The company has also identified several overseas banks who will provide dollar denominated suppliers line of credit to traders via banks of the traders native countries.

This scheme is beneficial to both the exporter, who avails of low-cost credit, and the trading partner who enjoys immediate settlement.