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Greensill maintained a servicing role in its supply chain finance (SCF) programmes that was never formally documented, resulting in costs and legal complications during its administration, GTR can reveal. 

The collapsed UK-based lender had a performing SCF portfolio worth around US$6bn when Grant Thornton was appointed as administrator in March, according to a document filed at Companies House last week. By the end of July, around US$£1.3bn of that total had been collected. 

Greensill’s SCF programme used three Luxembourg-based special purpose vehicles (SPVs) – Lagoon Park Capital, Wickham and Hoffman – to securitise receivables that would then be sold to investors, the largest of which was Credit Suisse. 

Those structures were put in place to ensure the programmes could be considered bankruptcy-remote, as the programmes would still function in the event of Greensill becoming insolvent. 

However, according to multiple sources familiar with the matter, it emerged after Greensill’s collapse that the lender had an ongoing servicing role linked to those programmes that was not formally documented. 

“When something is sold as being bankruptcy-remote, it means there is no continued involvement of the originator,” one source says. 

“When you look at the documentation, the understanding was that once Greensill originated the notes it would step out and have no further involvement. It seems that actually, it did quite a lot of the servicing, doing reconciliations and chasing up late payments.” 

One source questions whether the SPVs can be marketed as bankruptcy-remote “if payment relies on the services of others”. 

Part of Greensill’s administration process has involved untangling this arrangement retrospectively, resulting in parties involved racking up unexpected legal fees. 

Grant Thornton’s Companies House filing does not provide details on the situation, but says an agreement was struck in July between Greensill, the issuer and the note trustee Citi to ensure Greensill could “recover the costs of facilitating the flow of funds from the obligors to the investors”. 

Greensill and Grant Thornton declined to comment when contacted by GTR. 

Meanwhile, Credit Suisse is attempting to claw back money it is owed by the collapsed lender and has told investors in its Greensill-related funds that process is incurring further costs. 

The bank said in September investors would be charged an estimated US$145mn to cover expenditure associated with recovering debts. 

Part of those costs involve“operating expenses for [Greensill’s] broader SCF infrastructure”, as well as fees for advisory and external legal counsel, Credit Suisse said. 

The FT reported last month that US$10mn of that total was being used to pay a skeleton staff of 100 to 150 people, with Greensill kept operational to recover debts linked to GFG Alliance, mining company Bluestone Resources and construction firm Katerra. 

In the case of GFG – a loose grouping of companies connected to metals tycoon Sanjeev Gupta – the Grant Thornton document says Greensill is owed nearly US$699mn on its balance sheet, across 34 “buckets” of indebtedness. 

Many GFG companies have struggled to find replacement financial backers, amid allegations of fake invoices and an investigation by the UK’s Serious Fraud Office. 

Specialist industry publication Argus reported last week that Liberty Commodities, the group’s main trading arm, was being wound down. 

Grant Thornton says it is “considering a number of potential recovery strategies” in relation to GFG’s debts.