Clydesdale Bank tells industry that help is at hand for well-managed businesses
A senior banking figure from Clydesdale Bank told Scottish food and drink producers today (11 June) that while securing financial backing from the banks may be difficult, there are still opportunities for tightly run companies.
Graham Cunning, regional director for acquisition finance at Clydesdale Bank, met with food and drink executives in Perth to outline how the bank’s doors have remained open for business lending, despite the general funding market being difficult.
Graham spoke at a meeting of industry figures organised by leadership body Scotland Food & Drink. He told the audience that while bank lending in general has reduced since the credit crunch, the relative strength and stability of the food and drink industry means that finance is still available.
Graham said: “It is not impossible for companies to secure financial funding – Clydesdale Bank is still able and willing to lend to well-managed businesses.
“Food and drink companies, while not immune to the current climate, often pose a more attractive option for lenders since people still need to eat and drink, and banks focus on trading businesses.
“We are already seeing a number of stronger companies, both in the food and drink and other sectors, viewing the economic downturn as an opportunity to grow market share. Experienced management teams, running their businesses tightly and with stable cashflows, are still being looked upon favourably.”
Clydesdale Bank’s interim results published in April, showed a 14 per cent increase in business lending across the UK, representing £1.2bn of new money to support businesses.
In Scotland, the Bank continued its strong performance with average lending growing by 16 per cent - highlighting the Bank’s commitment to the local economy. In the six months to 31 March, Clydesdale Bank increased lending by 21 per cent in Glasgow, 7 per cent in Dundee, 11 per cent in Edinburgh, and 45 per cent in Aberdeen. Clydesdale Bank’s traditional banking model ensures that every pound raised from local deposits is reinvested back into lending for local businesses.
Paul McLaughlin, Scotland Food & Drink chief executive, said: "The food and drink industry is worth more than £7.5bn a year and is one of Scotland's key growth sectors. Although the industry continues to perform well, we have to be aware that the industry is trading in an increasingly challenging market and difficulties can arise.
"Scotland Food & Drink is committed to supporting the industry to ensure it retains its value and position and achieves its massive potential. We remain on track to reach our goal to build the value of the industry to £10bn by 2017 and firmly establish Scotland as a ‘Land of Food & Drink'."