Bank calls in £4m loan – at an hour's notice

AN ENTREPRENEUR who was once at the helm of two Scottish businesses that turned over more than £10 million has claimed that his bank gave him just one hour to repay more than £4m.

Terry Hamilton, the only shareholder in the collapsed businesses Trade Style Cabinets, based in Glasgow, and Torwood Timber Systems, a Livingston-based kit house maker, said he "fought tooth and nail" to save both concerns last month. However, he was forced to see both firms fold as he was unable to come up with the 4.3m called in by HBOS, the Scottish banking giant bailed out by the taxpayer and forced into an emergency takeover by Lloyds.

A spokeswoman for the bank was not able to verify the one-hour claim at the time of going to press.

Hamilton founded Trade Style – which manufactures factory-assembled kitchen, bedroom and bathroom furniture – in January 1992. He bought Torwood out of administration in January 2004.

Hamilton said: "I built them up into very successful businesses. I was in tears when I had to tell staff at Torwood that the bank was appointing administrators."

Torwood was placed into administration on 25 March, and Trade Style went under four days later.

Blair Nimmo and Tony Friar, of accountancy firm KPMG, were appointed joint receivers of Trade Style, having already been made joint administrators of Torwood.

They made 16 of the 34 staff at Torwood redundant, with the remaining 18 working with KPMG to sell the firm's assets.

Trade Style lost almost two-thirds of its workforce: 50 of its 80 employees have been laid off. The remaining workers are also engaged in helping KPMG to identify and realise the company's principal assets.

Nimmo, head of restructuring for KPMG in Scotland, said both firms had fallen foul of the recession. He added: "Despite having an excellent reputation in its market place, Trade Style Cabinets – like many businesses – has suffered from the economic slowdown, which has significantly impacted upon housebuilders over the last 18 months.

"This led to trading losses being sustained during 2009 and cash-flow pressures, which were exacerbated when its associated company, Torwood Timber Systems, was placed into administration."

Trade Style supplied independent retailers and housebuilders under the English Rose and Wrighton brands and operated from a wholly-owned 50,000sq ft factory on the Easter Queenslie Industrial Estate.

In the year to 31 January, 2009, the company turned over 5.5m, down 30 per cent on the previous year.

Torwood was hit by the downturn in the housing market and the rising cost of credit, Nimmo said. In the year to 31 January, 2009, it had a turnover of about 5m.