Risk register · entry
Q1 · PredictableGreensill Capital
Boring invoice finance that hid concentrated, under-insured, speculative lending.
Documented, foreseeable risks that were ignored anyway. The failure is attention, not information.
Why this quadrant
Real reverse factoring is short-dated, high-volume and spread across many unrelated debtors. That is what makes it low risk. Greensill's book was none of those things. It lent against "prospective receivables" from a handful of connected borrowers, and the whole structure rested on a single insurer's signature. When that cover lapsed on 1 March 2021 there was nothing underneath it.
The record
- Credit Suisse-managed Greensill funds froze roughly $10 billion on 1 March 2021certain
- Greensill filed for insolvency on 8 March 2021 after failing to repay a $140 million Credit Suisse loancertain
- Insurance cover of $4.6 billion, led by Bond and Credit Company (Tokio Marine-linked), lapsed 1 March 2021 after a Sydney court rulingcertain
- By April 2022, Credit Suisse had returned $6.7 billion of the $10 billion to about 1,200 investors, with $2.7 billion still outstanding and $600 million held in reservecertain
- GFG Alliance (Sanjeev Gupta) owed the funds about $1.3 billion; Bluestone Resources about $690 million; Katerra about $440 millionlikely
- GFG Alliance's total borrowing from Greensill over time reached roughly $5 billionlikely
- UK taxpayer exposure via British Business Bank COVID-loan guarantees estimated up to £335 million by the National Audit Officelikely
- SoftBank Vision Fund invested about $1.5 billion in Greensill (2019), later written offlikely
- In 2024, UBS bought out remaining Greensill-fund investors at 90 cents on the dollar and remained owed about $900 million by GFG-linked entitiesuncertain
- David Cameron joined Greensill as an adviser in 2018 and lobbied Chancellor Rishi Sunak by text in April 2020 over access to a COVID lending facilitycertain
Sources
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