The Commonwealth Trade Bank (CTB), led by British businessman Sanjeev Gupta, has closed amid tough financial conditions.
Part of Gupta’s privately-held GFG Alliance, the UK-based trade finance bank was created only one year ago following the alliance’s acquisition of Diamond Bank UK, the British subsidiary of Diamond Bank of Nigeria.
“In an environment of considerable economic and financial uncertainty, Commonwealth Trade Bank’s board and management team decided to undertake a solvent wind-down of the bank,” says GFG in a statement on May 1.
It adds that no lenders or bondholders will lose money, but there will be 35 job losses and its wholesale banking licence is being returned to regulatory authorities.
Commonwealth Trade Bank offered a range of solutions to facilitate international business, including receivables, inventory and supply chain finance, letters of credit and trade and documentary services associated with trade finance. It was focused on offering trade finance within the Commonwealth group of countries, such as Australia, Canada and India.
GFG Alliance has revenues in excess of US$20bn and a wide range of businesses. Its Liberty House business focuses on metals and industrials, and SIMEC consists of firms in the energy and resources sector.
In recent years the group has branched into the financial services industry, acquiring Tungsten Bank in 2016, which re-launched as Wyelands Bank – now its only bank – the same year. Subsequently, Wyelands Capital was also created in 2017.
“GFG Alliance has concluded that there is no longer a strong business case to operate two banks in the highly competitive banking market in the UK,” the statement said.
CTB’s remaining assets will be transferred to Wyelands Bank, which aims to support small and medium-sized enterprises to trade and grow.