Fletcher is worried about banks like Citi disappearing off the landscape.
Fletcher is worried about banks like Citi disappearing off the landscape.
Potential fallout from foreign banks withdrawing from this country was a key reason for Fletcher Building's $505 million capital raising, the company says.
Fletcher head of investor relations Philip King said the board wanted headroom to protect its balance sheet in the event debt was recalled, The Dominion Post reportedtoday.
That was despite Fletcher having $605m of undrawn facilities at the end of December.
"It's reality that we've seen the withdrawal of banks from New Zealand, and as an example we've seen Citibank reduce their involvement in our banking syndicate here," Mr King said.
"The potential fallout from this is huge for New Zealand businesses."
If offshore lenders pulled out, New Zealanders were then reliant on alternative forms of debt funding, which for this country was the retail bond market which had exploded into life this year.
The Dominion Post reported Fletcher's bank borrowing was heavily weighted toward ANZ National, BNZ, Commonwealth Bank of Australia and Westpac, but about $250m was owed to overseas lenders HSBC, Bank of Tokyo and Citibank.
