Intermediate Capital profits from credit crunch

23 November 2007

Intermediate Capital Group (ICG) has said today that it has seen a big boom in business after banks are unable to syndicate loans due to the credit crunch.

The mezzanine debt provider and fund manager said it has experienced a 33 per cent increase in gross profits for the six months to September, directly due to banks having to forfeit.

"Not a day goes by without a bank that made a loan in the last 12 months and can't syndicate it coming to us and offering it to us at much more attractive terms," Tom Attwood, ICG chief executive told the Financial Times. "We are seeing opportunities, the likes of which we haven't seen for years."

Mr Attwood reported ICG had taken "substantial positions" in two large leveraged buy-outs that banks had underwritten.

However, although enjoying success Mr Attwood conceded that the current atmosphere is still risky as he believes the credit crunch will have a "contagion effect" on the underlying economy, meaning that more defaults will occur.

In the morning market, shares in ICG rose by 6.1 per cent to $31.88, while its core income has risen by 24 per cent to $134.45 million.

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