Posted by Keyman188 > 2020-04-20 17:40 | Report Abuse

ABN Amro makes claims against troubled Singapore oil trading giant Hin Leong


SINGAPORE (BLOOMBERG) - ABN Amro Bank has become the latest lender to make a claim against a Singapore oil trading giant that filed for protection from creditors amid a plunge in oil prices.

The Dutch bank filed applications for charges related to irrevocable letters of credit tied to goods and documents of Hin Leong Trading (Pte) Ltd, according to filings with Singapore's Accounting and Corporate Regulatory Authority.

The Amsterdam-based lender is the second bank to file charges linked to Hin Leong, which owes some US$3.85 billion (S$5.48 billion) to more than 20 Singaporean and international banks, including HSBC Holdings, DBS Group Holdings Ltd. and Standard Chartered Plc.

London-based HSBC has the most exposure to the oil trader, with about US$600 million, people familiar with the situation said.

Hin Leong, founded in 1963 by Chinese tycoon Lim Oon Kuin, filed the application for a debt moratorium from Singapore's High Court on Friday, according to people with knowledge of the matter.

ABN Amro didn't specify the amount owed to the bank in the documents dated April 17. The charges covered include Hin Leong's bills of landing, air waybills, cargo and warehouse receipts, as well as the goods shipped related to the bank's credit.

An irrevocable letter of credit can't be canceled or amended by the issuing bank without the agreement of the parties in the credit transaction. Letters of credit are a critical financial lifeline for commodity traders, used as way of financing short-term trade.

A bank issues the so-called L/C on behalf of the buyer as a guarantee of payment to the seller. Once the goods have exchanged hands, the buyer repays the lender.

Societe Generale last week registered several charges covering goods and receivables financed by the bank and the Hin Leong bank account with the Paris-based bank.


##https://www.straitstimes.com/business/banking/abn-amro-makes-claims-against-troubled-singapore-oil-trading-giant-hin-leong

Posted by firehawk > 2020-04-20 17:43 | Report Abuse

Heard HSBC cancel their dividend earlier ... probably is already anticipated many cases of this kind :-(

Posted by Keyman188 > 2020-04-20 17:45 | Report Abuse

Head of oil trader Hin Leong didn't disclose US$800m losses

April 20, 2020 13:19 pm +08


SINGAPORE (April 20): The founder and director of top Singapore oil-trading company Hin Leong Trading Pte Ltd (HLT) directed the firm not to disclose hundreds of millions of dollars in losses over several years, he said in a court filing reviewed by Reuters.

The affidavit signed by Lim Oon Kuin, a Chinese immigrant in his 70s widely known as O.K. Lim, is part of a Friday filing to the Singapore High Court by HLT and subsidiary Ocean Tankers (Pte) Ltd, seeking a six-month moratorium on debts of US$3.85 billion to 23 banks.

The filing cites a collapse in the oil price and the coronavirus pandemic, which has hammered oil demand and pushed up costs for HLT, one of Asia's largest oil traders.

Despite reporting net profit of US$78.2 million for the business year ended in October, "HLT has not been making profits in the last few years," Lim said in the filing, which has not been made public.

The company "suffered about US$800 million in futures losses over the years but these were not reflected in the financial statements," he said. "In this regard, I had given instructions to the finance department to prepare the accounts without showing the losses and told them that I would be responsible if anything went wrong."

Reuters was the first to disclose the existence of Lim’s affidavit spelling out the losses and specifics including his acknowledgement of personal responsibility for not reporting the losses. Bloomberg cited the US$800 million in losses in a report late Sunday.

Lim, reached by phone, declined comment to Reuters. Patrick Ang, managing partner at Rajah & Tann Singapore LLP, which is advising Hin Leong, also declined to comment when reached by e-mail.

Lim's son Evan Lim Chee Meng, a director at HLT and Ocean Tankers, who also submitted a signed affidavit with the debt-moratorium request, did not respond to an email requesting comment. HLT and Ocean Tankers could not be reached for comment over the weekend.

The 23 banks named in the filing declined or did not respond to emailed requests in the past several days for comment.

The affidavit, which said Lim was resigning immediately as director of the family-held company he founded half a century ago from a single delivery truck, did not specify over how many years the losses were incurred or why he was blaming HLT's difficulties on problems that arose largely in the past few months.

Under Singapore law, Friday's filing automatically protects HLT from legal action by creditors for 30 days while the court decides whether to grant the six-month debt-repayment extension.

Lim said in the filing that HLT had held a video conference on Tuesday with creditors and advisers "to inform bank lenders of HLT's financial position," which it said included liabilities of US$4.05 billion against assets of US$714 million as of April 9.

A drop of two-thirds in the oil price in the first three months of this year, a tightening of bank credit lines and margin calls at HLT caused a "severe depletion" of the company's cash reserves, Lim said in the filing.

HLT recorded payments to meet the margin calls as accounts receivable, the company sold "a substantial part of inventory" being financed by banks to raise cash and it did not sufficiently hedge its exposure to a fall in oil prices, Lim said.

PetroChina International (Singapore) Pte Ltd, the trading arm of Chinese state-owned energy giant PetroChina Co Ltd, has terminated petroleum sales contracts with HLT and demanded for an immediate payment of US$23.87 million, Lim said. PetroChina did not immediately respond to email and phone requests for comment.

HLT may file more affidavits with further information, including a list of 20 largest unsecured and unrelated creditors, Lim said.

HLT could also potentially owe Oil Tankers US$2.67 billion for cargoes that the shipping company is unable to deliver as HLT's lenders have already sold the oil, Lim said. 


##https://www.theedgemarkets.com/article/head-oil-trader-hin-leong-didnt-disclose-us800m%C2%A0losses

Posted by Keyman188 > 2020-04-21 16:47 | Report Abuse

CIMB Group has exposure to S'pore troubled oil trader Hin Leong

(theedgemarkets.com / April 21, 2020 16:31 pm +08)

KUALA LUMPUR (April 21): CIMB Group Holdings Bhd is believed to be the Malaysian bank which has an exposure to the troubled oil trader Hin Leong Trading that owes almost US$4 billion to more than 20 banks, including DBS Group Holdings Ltd, HSBC Holdings Plc and Standard Chartered Plc.

The market talk has it that CIMB’s exposure to Hin Leong is to the tune of US$120 million to US$130 million. This will mean an exposure of more than RM500 million in its loan book.

When contacted on the matter, CIMB said: “CIMB does not disclose or comment on specific names or clients.”

The collapse of crude oil prices has brought Hin Leong to its knees and exposed the massive losses that the company has suffered for years.

The Singapore police today announced that they have launched an investigation into Hin Leong after US$800 million oil losses. The gap between the company's assets and its liabilities was reported to stand at US$3.34 billion.

Amidst concerns over its ability to finance its debt, Hin Leong saw some lenders pulling its credit lines amid a plunge in oil prices never seen before in decades.

Reuters, citing sources, noted that Hin Leong filed for a debt moratorium in Singapore last week after it began talks with creditors.

Bloomberg, citing people familiar with the situation, said London-based HSBC has the most exposure to the oil trader, with about US$600 million.

It was made known publicly recently that the Singapore oil trader had failed to declare US$800 million of losses before its collapse.

Yesterday, ABN Amro Bank NV became one of the latest lenders to make a claim against Hin Leong that filed for protection from creditors. It was reported that the Dutch bank filed applications for charges related to irrevocable letters of credit tied to goods and documents of Hin Leong Trading (Pte) Ltd.

For the first time in history, the US West Texas Intermediate futures contract dipped below zero to as low as negative US$40 per barrel amidst expectation of a sharp fall in global oil consumption given the curb on air travel and the movement control order to contain the Covid-19 outbreak.

At 4.15pm, CIMB's share price is down by 16 sen at RM3.61 — hovering at more than ten-year low. The stock is trading at 0.64 times price to book and is at a PE (trading twelve months) of 8.02 times.

For FY2019 ended Dec 31, CIMB's ratio of credit impaired loans to total loans, advances and financing rose to 3.07% compared to 2.91% in 2018.


##https://www.theedgemarkets.com/article/cimb-group-has-exposure-spore-troubled-oil-trader-hin-leong