Handelsbanken UK reports losses after Carillion’s collapse

Michael Lloyd

February 7, 2018

Handelsbanken UK is the latest lender to record losses after Carillion collapsed, The Telegraph reports.

The British arm of the Swedish bank, which has 208 branches in the UK, reported £50m worth of loan losses.

Anders Bouvin, chief executive of Handelsbanken, told Reuters: “Carillion is an exceptional case. Obviously something went horribly wrong that wasn’t visible from the outside.

“We managed to decrease our exposure substantially before the bankruptcy, but were unable to get out completely.”

The lender had arranged a £790m revolving credit line for Carillion before it collapsed on January 15 under the weight of £15bn worth of debts.

In 2017, Handelsbanken UK’s profits decreased by 23% to £114m, partly due to this loan loss.

Analysts predict the total damage from Carillion’s collapse across the British banking sector could be over £1bn.

In January, Santander UK said it had lost close to £200m on loans to Carillion.

Handelsbanken UK was planning for a hard Brexit by converting its UK business into a subsidiary, but has now put the plan on hold.

Mikael Sorensen, Handelsbanken’s UK chief executive, said: “Our preparations to create a subsidiary are progressing very well, and the investments we are making will ultimately strengthen the foundations for Handelsbanken’s further UK growth.”

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