Banks
RBS Holds $3.5B in Lyondell Loans
Mike Taylor
01/12/09 - 03:11 PM EST
Royal Bank of Scotland (RBS Quote) carries the largest lending exposure to bankrupt chemical company Lyondell Chemical, according to a Monday report by Bloomberg.
The report indicated that RBS holds $3.47 billion in loans to the Texas-based Lyondell, which is an indirect subsidiary of Netherlands firm LyondellBassell Industries. The U.S. unit filed for bankruptcy protection on Jan. 6.
RBS got the outstanding loans following its buyout of ABN Amro Holding's investment bank. ABN Amro had lent $1.6 billion in lower-ranking credit to Lyondell, according to Bloomberg.
Citigroup (C Quote) said on Jan. 9 would add $1.4 billion to its loan-loss reserves thanks to $2 billion in remaining exposure to Lyondell. Citi sold about $2 billion in Lyondell loans to private equity firm Apollo Management last year and wrote down portions of the portfolio over the course of the past year.
RBS shares were recently gaining 2.2% to $16.51. Citigroup was losing 15.1% to $5.73.