Relationships the focus for Lloyds TSB

SENIOR North West banker Dave Allanson says old fashioned banking rules are coming to the fore during the recession.

Mr Allanson, Lloyds TSB area director and head of large corporate in the North West, said his approach is based on relationships and backing “quality management teams”, regardless of the sector they are operating in.

“Lloyds has always been a relationship not a transactional bank. Someone once said to me: ‘never do anything you don’t understand’ and it’s good advice,” he said.

Despite the credit crunch and the uncertainty that the looming merger with HBOS has brought, Lloyds has proved that it will lend, if the deal is right.

Last month it backed Manchester insurer Swinton with a £175m refinancing deal, which gave the company the headroom to buy a chain of 91 shops from Insurance Australia for £50m.

In September it emphasised its willingness to lend to troubled sectors by supporting North West housebuilder Redrow in a £450m refinancing deal, along with a number of other banks.

Mr Allanson said the success of the bank’s large corporate unit in the North West, which has grown from a team of six to more than 30, since its launch in 2002, was testament to its approach.

“There are going to be winners in all the sectors, what is important is the quality of the management team. In these difficult times it has never been more important to have quality management teams, and if you’re a management team it’s never been more important to keep your bank central to your thoughts and plans.

“There needs to be an understanding on both sides for the relationship to work.With the Redrow deal, we took a view that the management team will be able to ride through these rough times.There are always going to be bumps along the way – it’s part of business life.”

Looking ahead, Mr Allanson says his approach will not change, and the focus will be on relationships with existing customers, rather than chasing new business.

“There are deals being done – sometimes it might not feel like that. We are spending a lot of time with our existing customers. I think at a time when there is limited liquidity in the market, it’s really important there is loyalty on both sides,” he adds.