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Wednesday, 24 April 19
SHIPPING MARKET INSIGHT - IS THIS A BANKERS' MARKET? - INTERMODAL
 Over the last 10 years, many of the traditional and top lending banks have made the decision to either downsize their portfolios or even exit shipping. According to Petrofin, Top 40 shipping banks’ lending has fallen since 2008 by 25%, whilst at the same time the world fleet has grown by 28%. On top of this, out of the banks that have decided to stay in the game, not all of them have the strength, the budget and the competitive terms to do so. As a result, the availability of financing for small-medium size companies has become a scarce, hence a luxury good. In other words, even when there is available financing for these companies, its cost is really prohibitive.
Apart from the banks’ endogenous and structural issues, their shipping departments also need to decide where to allocate their budget. In an era of growing LNG demand, numerous large shipping firms invest in the very capital intensive LNG carriers. Most of the large banks are there to support their very good clients. However, this means that a big percentage of their budget (and resources in general) end up to the LNG carriers’ financing, i.e. not much budget left for the remaining sectors/shipping projects. So, when these banks are left with a limited budget to spend, they become very selective and of course their pricing goes up as the list of the waiting finance projects is significant.
But what about the alternative ways of financing for the small and medium size companies? Asian leasing has indeed filled part of the gap that was created with the traditional banks’ exit, however, again this is available for owners with larger fleets and bigger ticket sizes. Public markets have been quiet regarding shipping in general; bond markets again require significant size. Therefore, the small companies are left with the option of the so called alternative financing. Private equity and hedge funds do have the funds to invest, but this only happens when they get the return of capital that they require; given that this most of the times is a double digit figure, then the capital cost for the small/medium ship owners increases dramatically.
There are quite a few new European banks that have joined ship financing – whose pricing sits in between the one of the traditional banks and that of leasing – however, their current budget is nowhere near to filling the gap that was left after the departure of the big banks.
Therefore, small-medium size shipping companies struggle to find competitive finance terms. Someone may argue that this had always been the case, however, in today’s ship finance market it is evident that the financing of small-medium size shipping companies is not the banks’ first priority, which should not be the case given the performance of such companies during recent years. Indeed, many small-medium size companies have proved their top quality and professionalism by not only surviving the crisis but also by getting back into expansion mode. There are many ship-owning companies falling into this category. Indicatively, only in Greek shipping there are more than 150 companies that own 3-15 bulk carriers, of more than 28,000 dwt and younger than 17 years old. A big percentage of these companies are long standing and solid companies; however, face the above finance issues.
This is the clientele that will provide the bank with projects of good credit quality and at the right pricing and therefore should be the one attracting the attention of ship financiers if they wish to make their business efficient and dynamic again.
By George Laios
Deputy CEO, Intermodal Group
Compiled by:
Intermodal Research & Valuations
Analysts:
Ms Eva Tzima
George Panagopoulos
Disclaimer and legal disclosure: For any further queries please do not hesitate to contact our Research & Valuations Department. The information contained in this report has been obtained from various sources, as reported in the market. Intermodal Shipbrokers Co. believes such information to be factual and reliable without making guarantees regarding its accuracy or completeness. Whilst every care has been taken in the production of the above review, no liability can be accepted for any loss or damage incurred in any way whatsoever by any person who may seek to rely on the information and views contained in this material. This report is being produced for the internal use of the intended recipients only and no reproducing is allowed, without the prior written authorization of Intermodal Shipbrokers Co.
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Tuesday, 18 June 19
TANKER SHIPPING: WHILE WE WAIT FOR 2020 TO KICK IN, IT'S ALL ABOUT POLITICS - BIMCO
Demand drivers and freight rates
Iran, Libya and Venezuela face export limitations because of sanctions and internal political troubles. At the s ...
Saturday, 15 June 19
SUPRAMAX: A 58,000-TONNER, OPEN QINGDAO, WAS BOOKED TO REDELIVER IN EAST COAST INDIA AT $6,500 - BALTIC BRIEFING
Capesize
The market closed on a quiet Friday last week after a few hectic days of mid-week trading. Trade routes from Brazil to the Far East we ...
Friday, 14 June 19
PANAMAX: OUTLOOK IS MIXED - FERNLEYS
Capesize
Sentiment changed to a more nervous tone as pacific cargo volumes failed to deliver as expected, however latest activity indicates res ...
Friday, 14 June 19
ELECTRONIC (PAPERLESS) TRADING - SKULD
KNOWLEDGE TO ELEVATE
Electronic Shipping Solutions: Bolero International Ltd, E-Title Authority Pte Ltd, Global Share S.A. (edoxOnline platfor ...
Wednesday, 12 June 19
KOSPO INVITES BIDS FOR 140,000 MT OF 4,600 NCV COAL FOR SEP. 2019 LOADING
COALspot.com: South Korea state-owned utility Korea Southern Power Co. Ltd (KOSPO) issued a tender for 140,000 MT of minimum 4,600 kcal/kg NCV coal ...
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- Romanian Commodities Exchange
- Antam Resourcindo - Indonesia
- Latin American Coal - Colombia
- Anglo American - United Kingdom
- Globalindo Alam Lestari - Indonesia
- Sojitz Corporation - Japan
- Dalmia Cement Bharat India
- Kalimantan Lumbung Energi - Indonesia
- Sakthi Sugars Limited - India
- Australian Coal Association
- Malabar Cements Ltd - India
- Samtan Co., Ltd - South Korea
- Thai Mozambique Logistica
- PetroVietnam Power Coal Import and Supply Company
- Banpu Public Company Limited - Thailand
- Siam City Cement - Thailand
- McConnell Dowell - Australia
- Riau Bara Harum - Indonesia
- Bhoruka Overseas - Indonesia
- Semirara Mining and Power Corporation, Philippines
- SMC Global Power, Philippines
- Toyota Tsusho Corporation, Japan
- GN Power Mariveles Coal Plant, Philippines
- Bayan Resources Tbk. - Indonesia
- Orica Australia Pty. Ltd.
- Parliament of New Zealand
- Trasteel International SA, Italy
- Miang Besar Coal Terminal - Indonesia
- GAC Shipping (India) Pvt Ltd
- Iligan Light & Power Inc, Philippines
- Binh Thuan Hamico - Vietnam
- AsiaOL BioFuels Corp., Philippines
- Deloitte Consulting - India
- European Bulk Services B.V. - Netherlands
- CNBM International Corporation - China
- Tata Chemicals Ltd - India
- IHS Mccloskey Coal Group - USA
- Mercator Lines Limited - India
- Bulk Trading Sa - Switzerland
- Lanco Infratech Ltd - India
- Vizag Seaport Private Limited - India
- Eastern Energy - Thailand
- Baramulti Group, Indonesia
- Gujarat Electricity Regulatory Commission - India
- Renaissance Capital - South Africa
- Mercuria Energy - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Indian Energy Exchange, India
- Electricity Authority, New Zealand
- Pipit Mutiara Jaya. PT, Indonesia
- San Jose City I Power Corp, Philippines
- Medco Energi Mining Internasional
- Barasentosa Lestari - Indonesia
- Thiess Contractors Indonesia
- TeaM Sual Corporation - Philippines
- Agrawal Coal Company - India
- Karaikal Port Pvt Ltd - India
- Sindya Power Generating Company Private Ltd
- Energy Development Corp, Philippines
- Port Waratah Coal Services - Australia
- Chamber of Mines of South Africa
- Electricity Generating Authority of Thailand
- Siam City Cement PLC, Thailand
- PTC India Limited - India
- Uttam Galva Steels Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Metalloyd Limited - United Kingdom
- VISA Power Limited - India
- Bhatia International Limited - India
- South Luzon Thermal Energy Corporation
- Bhushan Steel Limited - India
- Holcim Trading Pte Ltd - Singapore
- Borneo Indobara - Indonesia
- Indika Energy - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Altura Mining Limited, Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Global Business Power Corporation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Central Java Power - Indonesia
- SN Aboitiz Power Inc, Philippines
- Star Paper Mills Limited - India
- GVK Power & Infra Limited - India
- Carbofer General Trading SA - India
- Georgia Ports Authority, United States
- Sinarmas Energy and Mining - Indonesia
- Coal and Oil Company - UAE
- Oldendorff Carriers - Singapore
- Neyveli Lignite Corporation Ltd, - India
- Marubeni Corporation - India
- Chettinad Cement Corporation Ltd - India
- Xindia Steels Limited - India
- Coastal Gujarat Power Limited - India
- Ambuja Cements Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Aboitiz Power Corporation - Philippines
- ICICI Bank Limited - India
- SMG Consultants - Indonesia
- Timah Investasi Mineral - Indoneisa
- Videocon Industries ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Sree Jayajothi Cements Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Kaltim Prima Coal - Indonesia
- Ministry of Mines - Canada
- Bank of Tokyo Mitsubishi UFJ Ltd
- Rashtriya Ispat Nigam Limited - India
- Global Coal Blending Company Limited - Australia
- Indonesian Coal Mining Association
- Ministry of Transport, Egypt
- MS Steel International - UAE
- Petrochimia International Co. Ltd.- Taiwan
- Orica Mining Services - Indonesia
- PNOC Exploration Corporation - Philippines
- Bharathi Cement Corporation - India
- Bukit Baiduri Energy - Indonesia
- Coalindo Energy - Indonesia
- Edison Trading Spa - Italy
- Grasim Industreis Ltd - India
- Parry Sugars Refinery, India
- Alfred C Toepfer International GmbH - Germany
- White Energy Company Limited
- Salva Resources Pvt Ltd - India
- Merrill Lynch Commodities Europe
- Therma Luzon, Inc, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Indogreen Group - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Commonwealth Bank - Australia
- Indo Tambangraya Megah - Indonesia
- Mintek Dendrill Indonesia
- Minerals Council of Australia
- India Bulls Power Limited - India
- The State Trading Corporation of India Ltd
- Wilmar Investment Holdings
- Formosa Plastics Group - Taiwan
- Asmin Koalindo Tuhup - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Semirara Mining Corp, Philippines
- Bangladesh Power Developement Board
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Makarim & Taira - Indonesia
- International Coal Ventures Pvt Ltd - India
- Rio Tinto Coal - Australia
- CIMB Investment Bank - Malaysia
- Africa Commodities Group - South Africa
- Sarangani Energy Corporation, Philippines
- Aditya Birla Group - India
- The Treasury - Australian Government
- Manunggal Multi Energi - Indonesia
- ASAPP Information Group - India
- Essar Steel Hazira Ltd - India
- Meralco Power Generation, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- OPG Power Generation Pvt Ltd - India
- IEA Clean Coal Centre - UK
- Vedanta Resources Plc - India
- Central Electricity Authority - India
- Standard Chartered Bank - UAE
- Heidelberg Cement - Germany
- Maheswari Brothers Coal Limited - India
- Intertek Mineral Services - Indonesia
- Attock Cement Pakistan Limited
- The University of Queensland
- Goldman Sachs - Singapore
- Economic Council, Georgia
- Directorate General of MIneral and Coal - Indonesia
- Cement Manufacturers Association - India
- Simpson Spence & Young - Indonesia
- Australian Commodity Traders Exchange
- Tamil Nadu electricity Board
- Posco Energy - South Korea
- Kartika Selabumi Mining - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Sical Logistics Limited - India
- London Commodity Brokers - England
- Kideco Jaya Agung - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Gujarat Sidhee Cement - India
- Kumho Petrochemical, South Korea
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- LBH Netherlands Bv - Netherlands
- Meenaskhi Energy Private Limited - India
- Price Waterhouse Coopers - Russia
- Singapore Mercantile Exchange
- Ind-Barath Power Infra Limited - India
- Eastern Coal Council - USA
- Energy Link Ltd, New Zealand
- PowerSource Philippines DevCo
- Mjunction Services Limited - India
- Interocean Group of Companies - India
- Indian Oil Corporation Limited
- Directorate Of Revenue Intelligence - India
- Larsen & Toubro Limited - India
- Jindal Steel & Power Ltd - India
- Global Green Power PLC Corporation, Philippines
- Planning Commission, India
- Savvy Resources Ltd - HongKong
- Petron Corporation, Philippines
- Madhucon Powers Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Kepco SPC Power Corporation, Philippines
- Kobexindo Tractors - Indoneisa
- Independent Power Producers Association of India
- Ceylon Electricity Board - Sri Lanka
- GMR Energy Limited - India
- Straits Asia Resources Limited - Singapore
- Ministry of Finance - Indonesia
- Wood Mackenzie - Singapore
- New Zealand Coal & Carbon
- Power Finance Corporation Ltd., India
- Jaiprakash Power Ventures ltd
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bukit Makmur.PT - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Pendopo Energi Batubara - Indonesia
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