EIB halts Glencore's lending due to governance concerns
By Clara Ferreira-Marques and Philip Blenkinsop, Reuters
June 2, 2011, 9:47 pm TWN
LONDON/BRUSSELS--The European Investment Bank (EIB) has frozen all new loans to commodities trader Glencore and its subsidiaries, it said in a statement on Wednesday, citing “serious concerns” over the group's corporate governance.
The EIB, the European Union's lending institution, provided in 2005 a US$50 million loan to Mopani Copper Mines, a Zambian subsidiary of Swiss-based Glencore, to help pay for the modernization of a copper smelter.
But Mopani has since been accused by some non-governmental organizations — most recently by campaign groups in an open letter signed by a group of European parliamentarians — of tax evasion and of causing widespread pollution.
Glencore, the world's largest diversified commodities trader, listed on the London stock exchange in May in a record-breaking market debut.