Loan market participants are being sounded out on deals earlier than ever before, according to Chris Parsons, who is retiring from the syndicated loan market after a 20-year career.
Parsons, who has spent the past 12 months helping to build a UK corporate banking business at Abbey says that the development is an indication of the increasing nervousness in the loan market, with borrowers less certain of being able to secure funding and lenders less willing to embark on underwriting transactions without certainty of demand from investors. At Abbey, Parsons has been instrumental in starting up the business of servicing mid-cap UK corporate clients and sponsors. Large cap lending is left to parent firm Santander. Abbey is not pursuing LBO business, but is focusing on establishing a traditional corporate relationship banking franchise. Management now wants to take larger positions on deals and secure more senior roles on its core business of lending to mid cap firms. This has already proved to be successful, according to Parsons. So far the emphasis has been on commercial real estate, as well as the healthcare and educational sectors. The bank has participated in numerous deals, although it has as yet underwritten relatively few. When Parsons joined in March 2007, there were some 25 people in the firm’s UK corporate banking business. It now boasts about 80 staff. Coinciding with Parsons’ departure, Liz Williams, previously in the loan business at Lloyds TSB and Danske, has joined as head of loan syndications at Abbey. Parsons entered the loan markets in 1989, and has previously worked for NatWest and RBS. He is leaving the banking industry to work in a family business with his daughter.