The Royal Bank of Scotland plans to phase out about 40% of its existing shipping portfolio in favour of supporting its ?relationship? clients.
The Royal Bank of Scotland plans to phase out about 40% of its existing shipping portfolio, which is considered non-strategic, in favour of supporting its ?relationship? clients.
RBS"s portfolio stands at $30bn indicating that loans totalling about $12bn could be shed in the coming years.
However, the bank"s global head of shipping Lambros Varnavides stressed that this would not result in the portfolio being reduced to $18bn by the end of 2009.
He pointed out that RBS could not exit from these loans ?overnight? and that the bank had ?commitments going forward of $5bn-$6bn? that it intended to honour.
Mr Varnavides said RBS would focus on its ?relationship clients?, who also bought non-lending services from the bank.
?These relationships will be preserved, nurtured and expanded,? he said.
Those clients who ?just use our balance sheet and pass ancillary services to other banks? would no longer be accommodated.
Mr Varnavides said he expected RBS to remain the number one lender in the Greek market, given ?the high percentage of relationship business? there.
Plans to re-position RBS"s shipping portfolio emerged after the bank announced the largest annual loss in UK corporate history.
RBS, which had to be bailed out by the government last year, said that its 2008 net loss totalled £24.1bn ($34.6bn) and unveiled a massive restructuring programme that will hive off many of its international businesses.
The UK"s second largest bank also said it will offload £325bn of toxic assets into a government insurance programme.