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Blighty banks softly back biz

Mood among some U.K. film bankers is more cautious than in late '90s

When Lee Beasley went missing last year as head of the Royal Bank of Scotland’s film finance unit, rumors spread like wildfire that one of the leading lenders to indie Brit pics was pulling out of the business.

But RBS officials say it was all a big misunderstanding.

Even though Beasley has now resurfaced at the Standard Chartered Bank in Hong Kong, where he will be applying his expertise largely to the financing of Asian movies, his previous employer RBS insists that it is committed as ever to film lending, and is preparing to make a major announcement to that effect.

John Swain, an RBS vet who took charge of the bank’s film activities last summer, admits that the past year was somewhat transitional. First Beasley took time off for health reasons, then the bank launched an internal review of its film financing activities, which over the past decade had sprouted across two or three different departments.

While that was going on, Beasley quit for Hong Kong — but the reason for his exit was not made public until he had served out his leave, thus fanning the flames of rumor that RBS had got cold feet about film.

Yet during all that time, Swain insists that RBS never stopped signing “good levels of new business” in film and TV, including a couple of the biggest deals it has ever done for a “well-known L.A. and London-based independent producer.”

His coyness about the identity of that producer and the films concerned illustrates why there is so much speculation, and so little hard fact, about who is really doing what in the U.K. film banking sector.

Client confidentiality combines with the natural reticence of bankers to let anyone know what they are really up to, least of all their competitors.

Along with RBS, the principal players at the moment appear to be Allied Irish Bank under Gillian Duffield, which gap financed about 10 movies last year, including “Stormbreaker” and “Keeping Mum”; and Bank of Ireland under Martin McCourt. Societe Generale, where the film unit headed by veteran Premilla Hoon specializes in big corporate deals, is also nosing its way back into single project financing.

The American banks that made noises two or three years ago about entering the U.K. film biz seem largely to have given up and gone home, realizing that there’s simply not enough volume of viable business to make the expense of a London outpost worthwhile. Comerica, however, maintains an informal alliance with AIB.

Overall, the mood among the handful of U.K. film bankers is more cautious than it was when gap financing first came into vogue in the late ’90s. Then banks were willing to cover 30% of budgets, but these days that figure rarely goes above 20%. They never talk about their disasters, but clearly some fingers were burned, which may be one reason why the likes of DZ Bank, Barclays and Dexia-BIL are no longer in the game.

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