Citi Builds Commodity Trade Finance as Others Retreat

Posted by Eric Haun
Friday, May 16, 2014

Citigroup plans to double its commodities trade finance team within the next three years as it seeks to benefit from a retreat by some rival banks, the head of the business said.

Citigroup is one of the biggest players in trade finance but has been relatively small in the specific area of commodities trading. It started building a commodities trade finance team to focus on the sector in 2012.

Trade finance is a form of short-term lending or guarantee that ensures payment is made on an international shipment of goods.

Kris Van Broekhoven, global head of commodities trade finance at Citi, told Reuters he hoped to double the team's 14-strong headcount within three years and become a top five player.

"We started in energy in 2012, expanded into metals and minerals in 2013 and plan to move into agricultural commodities by the end of 2014," he added.

The bank aims to capitalise as rivals such as Morgan Stanley and JP Morgan withdraw from the business of trading physical assets such as cargoes of crude oil or metals.

"They are selling these platforms or exiting the business. Trading platforms are being picked up by producers, private equity and trading houses," Van Broekhoven said.

JP Morgan has agreed to sell its commodities trading operation to Swiss-based commodities trading house Mercuria, while Morgan Stanley has sold its business to Russian oil major Rosneft.

When these trading operations were part of investment banks, the traders could easily rely on their own banks to provide trade financing.

"But when they move, their funding changes, and they turn to the commodity trade finance banks to fund them, so that creates an expanded market for us," Van Broekhoven said.

(By Simon Falus; additional reporting by Charles Staples; editing by Jane Baird)

Maritime Reporter October 2013 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

People & Company News

DP World Mulls Senegal Free Zone

DP World  is looking to develop a free zone in Senegal, Chairman Sultan Ahmed bin Sulayem said on Wednesday. Sulayem was speaking at an African investment event in Dubai.

MOL Merges Group Companies; Upgrades Bridge Simulator

MOL adds DPS and enhances safe operation by integrating expertise through merger Mitsui O.S.K. Lines, Ltd. (MOL) announced the merger of MOL Marine Consulting, Ltd.

Swissco Doubles Rig Fleet

SGX Mainboard-listed Swissco Holdings Limited an integrated, international marine services provider, today announced having completed the acquisition of four additional mobile offshore drilling units,

Tanker Trends

Scanjet Bags Multiple Tank Management Orders

SCANJET Group has followed up its breakthrough Tank Management order from Stolt-Nielsen with a series of contracts for its ITAMA Intelligent Tank Management concept including Tankcleaning,

GTT Earns Five AIPs for Multi-gas Membranes

Gaztransport & Technigaz (GTT), designer of membrane containment systems for the maritime transportation and storage of LNG (Liquefied Natural Gas) announced five

Steel Cut for Yamal LNG Project’s Lead Tanker

A steel-cutting ceremony was held on September 29 for the lead gas tanker ordered by SCF Group for transportation of liquefied natural gas (LNG) under the Yamal LNG project.

Finance

Norvestor to Become PG’s Largest Shareholder

Norvestor VI, L.P., a fund advised by Norvestor Equity AS, announced it has signed an agreement to invest in Ing Per Gjerdrum AS including its subsidiaries PG Hydraulics AS and PG Construction AS.

GasLog Closes First Option Vessels Dropdown

GasLog Ltd.  announced today the closing of the sale of two modern liquefied natural gas (“LNG”) carriers, the Methane Jane Elizabeth and Methane Rita Andrea,

Brent Holds Above $97, Eyes Worst Quarter Since 2012

Brent crude futures hovered above $97 a barrel on Tuesday, aided by firm U.S. and Chinese data, but the oil benchmark was on track for its deepest quarterly drop

Energy

Leak May Sideline New Mexico Nuclear Waste Site

It may be five years before a nuclear waste dump in New Mexico closed by a radiation leak is fully operational again, and the facility will need at least $240

Imperial Oil Completes Maintenance at Kearl Oil Mine

Imperial Oil Ltd said on Tuesday it has completed a two-week major maintenance turnaround at its 110,000 barrel per day Kearl oil sands mine in northern Alberta.

Swissco Doubles Rig Fleet

SGX Mainboard-listed Swissco Holdings Limited an integrated, international marine services provider, today announced having completed the acquisition of four additional mobile offshore drilling units,

News

DP World Mulls Senegal Free Zone

DP World  is looking to develop a free zone in Senegal, Chairman Sultan Ahmed bin Sulayem said on Wednesday. Sulayem was speaking at an African investment event in Dubai.

MAN Propulsion Packages for New Trawler Series

Orders for five fresh-fish trawlers feature two different ship designs and MAN 6L27/38 engines and aft-ship equipment Icelandic owners, HB Grandi, Vinnslustodin hf.

MOL Merges Group Companies; Upgrades Bridge Simulator

MOL adds DPS and enhances safe operation by integrating expertise through merger Mitsui O.S.K. Lines, Ltd. (MOL) announced the merger of MOL Marine Consulting, Ltd.

 
 
Maritime Careers / Shipboard Positions Maritime Contracts Maritime Security Pipelines Pod Propulsion Port Authority Ship Repair Ship Simulators Shipbuilding / Vessel Construction Winch
rss | archive | history | articles | privacy | terms and conditions | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1496 sec (7 req/sec)