British banks blamed for collapse of DAF rescue

A FURIOUS row was raging last night between DAF, three of Britain's high street banks and the Dutch and Belgian governments over who was to blame for the collapse of the rescue package for the ailing truck and van manufacturer.

DAF, which is thought to owe its banks and other creditors 1.5bn guilders ( pounds 570m), was seeking a long-term cash injection of at least 500m guilders and a short-term facility of 150m guilders.

The company said yesterday morning that a 'minority' of its banks had decided that further investigation of its long-term financial restructuring plan was necessary before they committed themselves.

The Dutch and Belgian governments, however, regarded this as unacceptable and wanted immediate approval for DAF's restructuring before granting short-term funding for the company.

In the Commons, Robin Cook, Labour's trade and industry spokesman, laid the blame on National Westminster, Barclays and Lloyds, saying these were the three 'minority' banks that had wrecked the restructuring.

The Dutch Minister for Economic Affairs, Koos Andriessen, also put the blame for DAF's move to seek protection from creditors at the door of its banks.

Mr Andriessen accused the banks of setting unacceptable terms for the 150m guilder short- term bridging loan while refusing to commit themselves to a long- term survival plan.

Privately, DAF blames the three British banks for triggering the crisis, saying that they refused even to come up with short-term financing until its long-term financial strategy had been spelt out.

The three UK banks conceded yesterday that they had been in the minority but denied categorically that they were to blame. Barclays said: 'We have been supportive of the company over a long period and will continue to be supportive of attempts to restructure DAF.'

NatWest issued a similar statement, adding that it had 'offered short-term finance pending satisfactory long-term restructuring plans and independent auditing'.

Privately the three banks believe they have been set up as fall guys for DAF's failure to produce a credible, long-term financial strategy. 'They were asking the banks to lend blind and that was not acceptable,' one banker said.

Mr Andriessen said yesterday he believed a slimmed-down DAF still had a strong chance of survival if it concentrated on its core truck-making activities.