Standard Chartered is looking
to raise £3.3bn (€3.7bn) through a rights issue ahead of Basel III
and other banks, particularly Barclays Bank, are rumoured likely to
Barclays raised capital
through a private placement last year in light of Basel II
requirements. Under Basel III, banks will need more capital to run
the same level of business than was required by Basel II. The new
rules mean that banks face the choice of whether to raise more
capital to support business growth, or limit lending to a level
supported by existing capital.
A source in the UK leasing
market claimed that Barclays had lost its appetite for longer-term
risk, and is reluctant to write leases of seven years or longer
unless there is a structured buyback from the manufacturer over
years five, six, seven and beyond. “Barclays is focused on the
balance sheet and doesn’t want to commit to contingent liability
over the long term,” the source said.
Barclays rejected the claim.
Global head of asset finance Alex Brown said: “Corporates which can
demonstrate a strong financial performance and a history of
acceptable account behaviour would always be in a position to
secure long-term deals on competitive terms from us. It is some way
off the mark to suggest that we have no appetite for long-term
risk. We are very much open for business.”
The source reported looking
to the US and Middle East to make up the shortfall from UK funders.
“Banks are considering, if Armageddon happens again, how fast can
we get out? With an operating lease, or assets funded on a lease,
you can’t get your liquidity. A lot of banks are focused on easier
funding, like hire purchase.”
Basel III is to be given final approval later this