Dogs welcome, but restaurant starved of money bans bankers

A Michelin-lauded restaurant owner is ­refusing to serve bankers after his demand for a loan was turned down.

The creamy risotto with prawns and fine herbs has won plaudits from the Michelin Guide and so too have the spare ribs with thyme and honey.

Yet one group is unlikely to taste such delicacies following its exclusion from Les Ecuries de Richelieu, a restaurant on the outskirts of Paris.

Owner Alexandre Callet is ­refusing to serve bankers after his demand for a €70,000 ($110,000) loan to open a second restaurant was turned down. Outside his establishment is a blackboard making his message clear: “Dogs accepted, bankers banned”.

His action underlines the difficulties faced by a French restaurant trade hit by the country’s economic woes and last year’s ­terrorist attacks. Chefs complain that even when they are profitable, banks are unwilling to lend to them amid a perception that the industry is built on unstable financial foundations.

Mr Callet opened Les Ecuries de Richelieu in Rueil-Malmaison, an affluent suburb, in 2008. He says he made 20 requests for a loan before a bank agreed to invest in his project.

Two years later the establishment was mentioned in the ­Michelin Guide. With a three-course meal costing only €35, the restaurant is not luxurious enough to obtain a Michelin star but the guide nevertheless says that it offers “fine traditional ­cuisine”.

Mr Callet says takings are rising. “I’ve paid off the loan and the restaurant has an excellent profit margin,” he adds.

He believes a new loan to open a second restaurant should have been a formality but instead he wrote to dozens of banks. Only one bothered to answer and that was to say no. The refusal illustrated the difficulties in France.

“Every time we want to launch a business we have to get down on our hands and knees,” he said. “Bankers today are not doing their job.”

Economists say access to credit is particularly difficult in the restaurant sector. Financiers prefer to back projects that involve less investment, such as coffee shops, which are enjoying a boom.

Concern was fuelled by figures showing that restaurant takings fell 9.5 per cent in the fourth quarter of last year and 21.5 per cent in Paris. The fall was partly because of the attacks in January and November, which deterred Parisians from dining out, and partly a result of the economic slowdown.

Economists say that given the prevailing gloom, bankers tend to throw out requests for loans from restaurants without bothering to study the balance sheet.

THE TIMES