HSBC has entered into an 'unusual' loan deal with Arcadia, the UK-based retail group owned by Philip Green.

The bank could act as guarantor in relation to letters of credit (L/Cs) to suppliers to the businessman who has been involved in a number of controversies during his career.

Financial restructuring

Green's deal with HSBC gives the bank security over millions of pounds worth of cash deposits as it draws up plans for a radical financial restructuring.

The agreement with HSBC extends existing terms to provide Green's business empire with extra breathing space after the recent tightening of supplier credit insurance.

L/C guarantees

Under the terms of the agreement, HSBC could act as guarantor in relation to L/Cs to suppliers if required.

Sources in the City of London described the agreement as 'unusual'.

Arcadia operates 570 high street stores across the UK, including Topshop, Top Man,

Dorothy Perkins, Miss Selfridge, Burtons, Evans, Wallis and Outfit.


Green has been embroiled in several controversies during his career, including the demise of British department store chain BHS which he sold for £1 (US$1.3) in 2015.

By April 2016 the chain had debts of £1.3 billion (US$1.7 billion), including a pensions deficit of £571 (US$739 million).

This article represents the views of the author and not necessarily those of the ICC or Coastline Solutions.