Tighter credit market: An oil tanker berthing near storage tanks off Jurong island in Singapore. Unless they have deep pockets, commodity traders face being frozen out of the market by risk-averse bankers. — AFP
SINGAPORE: Bankers are increasingly reluctant to give commodity traders in Asia the credit they need to survive as the lenders grow ever more fearful about the risk of a catastrophic default.
Their anxiety has reached new heights in recent days as fabled Singapore oil trader Hin Leong Trading (Pte) Ltd struggles to repay debts said to amount to almost US$4bil.
And that’s just weeks after another commodities firm in the city state, Agritrade International Pte, collapsed after a unit defaulted on its loans.
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