All over the world banks lend money to diamond business with reluctance now. As the result it caused terrible consequences for diamond miners and for gem wholesalers. But retail prices are considered to be stable as the changes on the diamond market won’t be accepted by the engaged couples who stimulate the demand. But that's what diamond manufacturers want to believe in.
Changes in the diamonds industry were firstly caused by new regulations with the aim to prevent a financial crisis. The government pressure made banks in their turn act more carefully, especially when lending credits to the diamond manufacturers. Many banks simply stopped serving the diamond industry. For example, the Belgian bank KBC closed a branch unit in Antwerp, which was a rival for diamond manufacturers all over the world for many years. Bank Leumi in Israel had got out of the diamond business too, as well as ABN Amro in the Netherlands.
Needless to say, that there a lots of manufacturers simply can't survive without banks' support. Why is this happening? Why the banks are getting out of diamond business? You can read the answer in our next post.