Magazine article American Banker

Credit Lyonnais Forms U.S. Unit for Middle-Market Financing

Magazine article American Banker

Credit Lyonnais Forms U.S. Unit for Middle-Market Financing

Article excerpt

Credit Lyonnais, the French banking giant, has formed an American subsidiary to provide asset-based financing to middlemarket companies nationwide.

Based in Stamford, Conn., Lyon Credit Corp. is headed by John M. Bowes, former president of Chrysler Capital Corp., which had $7 billion of assets before closing in 1992.

In a telephone interview, Mr. Bowes acknowledged that he is entering a crowded field of bank and nonbank competitors in the asset-based lending business.

Despite the French bank's backing, it's unlikely that the entry of Lyon Credit will alter the competitive landscape.

"I can't see where the creation of one more player makes that much of a difference," said a spokesman for a major finance company, who did not want to be identified.

But Mr. Bowes said Lyon Credit plans to become a niche player, offering "uniquely tailored" products through a national sales force.

Mr. Bowes said he expects to achieve asset size of several hundred million dollars over time.

That's bigger than some regional players, but only a fraction of the size of the top finance companies. General Electric Capital Corp. and General Motors Acceptance Corp. both had more than $90 billion of assets at yearend 1992, according to the most recent American Banker survey of finance companies.

Lyon Credit will focus on companies with sales of $10 million to $300 million, providing equipment and asset-based financing, and financings for leveraged buyouts. It also plans to provide project financings and arrange leveraged leases. …

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