One of the industry’s largest lenders, with a reported $2 billion portfolio, is exiting the sector.
Standard Chartered Bank is shutting its diamond and jewelry business, putting yet more pressure on industry financing.
“When we announced our new strategy, we said that we would look to exit businesses that were nonperforming or that did not meet our new risk profile, with all of our business segments subject to review,” said a Standard Chartered spokesperson. “As a result of this review, it has been concluded that continuing to provide financing to the midstream diamond and jewelry segment falls outside of the bank’s tightened risk tolerances. We are working with clients to ensure a smooth exit.”
The news that one of the industry’s largest lenders was exiting the sector follows the departure of its founder Anna Martin to Gemological Institute of America in 2014. Afterward, the bank said it was committed to the clients in its reported $2 billion portfolio. However, another one of the division’s founders, Kishore Lall, also left a few months back, and that was followed by announcements the division was tightening lending to the diamond and jewelry sector.
The bank was reportedly caught up in the default of Winsome Diamonds and Jewellery, considered one of the biggest defaults in Indian history.