Euler Hermes chief hits back at business secretary
Fabrice Desnos, UK chief executive of Euler Hermes, has hit back at Lord Mandelson, the business secretary, who accused trade credit insurers of “over-reacting” to the economic downturn.
Lord Mandelson censured credit insurers for not offering cover to small and medium-sized businesses, adding that it was their responsibility to act in bad times, as well as good.
But Desnos, boss of the UK’s largest trade credit insurer, insisted Euler Hermes would not insure firms supplying businesses that were in danger of financial difficulties.
“Our first priority is the protection of our clients. This has not altered and we remain committed to steering them away from the major risk. In the current times, we would fail to deliver our best service ... if we were not to advise clients to be extra cautious when dealing on credit terms.”
He also said he hoped this week’s bank bail-out would help smaller businesses to obtain credit.
Banks will be able to take up government insurance against their expected bad debts and the Bank of England will be able to buy up to £50bn worth of assets in companies.
The government is expected to follow up the measures with a scheme aimed at helping small firms find trade credit insurance.