Withdrawal of Barclays Marine
Finance clears the water for rivals. Fred Crawley
reports.
Go deeper with GlobalData
The closure of Barclays Marine
Finance, at a time when its market continues to show a gradual
uplift, comes as a reminder that conditions are still tough.
A spokesperson for Barclays
Corporate said it took the strategic decision to close the marine
finance division to new business following a “detailed review of
the challenges of operating in this sector”. Existing clients’
marine mortgages will not be affected by the move.
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By GlobalDataThe resulting gap in the UK market
has sparked a push for expansion from old rivals, as well as a rush
of interest from new funders including Société Générale joint
venture SGB Finance.
No show at boat
show
Market reaction was apparent at the
UK Southampton Boat Show (SBS) in September, where BMF failed to
exhibit for the first time in years.
Lombard Marine Finance, BMF’s chief
competitor in the sector since the withdrawal of Bank of Scotland
Marine Finance in 2008, had particularly high visibility at the
show. Lombard reported business from the show up 53% on last year’s
total, which in itself had been significantly up on 2008’s figure.
LMF did not disclose the value of business undertaken, but said
that the average deal size was around £150,000 (€177,000).
LMF head Ian Braham said he was
“truly delighted” with the results of the show, adding that it had
“only served to reinforce Lombard’s continued commitment to the
marine sector”.
Braham conceded that BMF’s decision
had contributed to LMF’s success at the show, but added that
retailers were seeing generally higher sales.
Attendance figures for the boat
show were less than 1% up on last year. Looking ahead, Braham said
LMF was “perfectly positioned” to acquire a greater market share,
and was “in growth mode”. The division hopes to acquire a higher
level of information from customers than in previous years, but
underwriting standards have not changed much.
Ground staff
SGB Finance, the joint venture
between SocGen subsidiary CGL and world-leading yacht builder
Beneteau Group, did not exhibit at the show but sought business
through staff on the ground.
SGB entered the UK marine market in
September 2009, but has been a presence in the European market for
more than 30 years. Its new UK office of four staff represents one
of 16 units across Western Europe and North America.
Chris Garner, representing SGB at
Southampton, said the company is “actively open for business in the
UK”, and increased quotations at the show by 25% compared to last
year. “More business is becoming available as SGB becomes more
recognised in the UK.”
The loss of BMF from the show was
“potentially one of the sources of the increase” in business,
Garner said. SGB is taking a competitive stance in the UK, offering
a fixed rate APR of 5.5% and a variable rate of 3.9%.
Another lender present but not
exhibiting was Close Marine Finance (CMF), a component of the
aviation finance business of merchant bank Close Brothers Group.
Formerly an aggressive presence in the market, CMF has been
relatively quiet for the last two years – but is now looking to
drum up more business again.
Close Aviation Finance MD Richard Kearsey, who also leads CMF,
describes the business as having a “very positive” view of the
marine market at present, with “a different approach to other
lenders”.
