Diamond deal dents Stanchart profits

Although the bank did not reveal the identity of the client, industry sources told BusinessWeek that about $7 million (P77 million) of the total impairment charge can be attributed to Motiganz Diamond Company Botswana. Motiganz’s cashflow is hampered by the purchase of a huge multi-million dollar rough stone, which it now finds difficult to sell in the current depressed market.

Stanchart gives credit lines to finance De Beers’ sights and reports say Motiganz used part of its credit line to purchase the stone, which is now part of the bank’s collateral.