EXPORT CREDIT AGENCIES (ECAs) in Shipping

Transcription

1 CASS Business School - 4th Athens Triennial Meeting Is this world changing? EXPORT CREDIT AGENCIES (ECAs) in Shipping Ioannis Alexopoulos.: London.: Athens.: Singapore Eurofin Eurofin S.A. Seafin

2 Eurofin Group (Overview) Oldest, largest, specialized ship-financing investment boutique with global coverage 30 Years US$24 Billion Flexibility Commitment Recognition Global Coverage Committed in Ship-Finance Ship-Financing Deals (globally) Tailor made structures Team dedicated to ship-financing Representing KfW IPEX-Bank Offices in major shipping centers London Athens Singapore 2

3 2005-Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q3 Shipping environment Freight Rates & Asset values (Change and Correction) In all three main shipping sectors Shipping Charter Rates (Indexed - as at beg. Q ) Asset Values (US$ mm - as at Q ) Tanker Bulker Container Dry Year old Capesize % Change (77%) 34 July 2008 October Container 65 5-Yr 4,500 Teu vessel % Change (81%) 11.8 July 2008 October % Change (62%) (71%) Tanker 79 5-Year old Aframax % Change (62%) 30 (80%) 0 July 2008 October 2017 Source: Clarkson s Research, Baltic Exchange 3

4 Offshore & Energy Maritime Environment A totally different picture : Strong Freight Rates & Low Newbuilding Prices 2013 onwards: Freight rates under pressure LNG Freight Rates LNG Newbuilding Prices 140, k cbm 120, , k cbm Spot Rate $/Day k cbm 80, , , , Q2 4

5 Global Debt-Ship financing landscape Global Shipping Portfolio (Change since 2008) Largest Global Shipping Banks Portfolios* European Banks Asian Banks US Banks Reduction in European Banks Shipping Portfolio since Source: Marine Money (May 2017) * Figures as at Dec

6 DnB NOR Bank of China China EXIM KfW IPEX Korea EXIM Nord LB DVB BNP Paribas BTMU Credit Suisse Nordea China Development Bank ABN Amro Credit Agricole CIB SMBC Citibank ING SEB ICBC (excl. Leasing) HSH Nordbank (Core) Bremer Landesbank HSBC Deutsche Bank Danish Ship Finance Danske Bank / Focus Bank Standard Chartered Bank of America Korea Development Bank Unicredit Japan Bank for Intl. Coop. DBS Swedbank CBA Societe General Santander Piraeus Bank National Bank of Greece Alpha Bank CIC JP Morgan Global Debt-Ship financing landscape Asian Banks on the rise Total Shipping Loans: US$ Billion* Source: Petrofin (July 2017) European Banks Asian Banks US Banks * Figures as at Dec

7 Global Debt-Ship financing landscape In Constant Transformation From American to... European... to... Asian Banks & Debt Funds 70s- 80s 90s-Present Present Chemical Bank Bank of America Deutsche Schiffsbank Fortis Bank Of China Citibank Bank of New York Bank of Scotland Nordea ICBC Bankers Trust First National Bank Continental Illinois Wells Fargo Deutsche Bank Royal Bank of Scotland Bremer Landesbank DVB DnB Nor HSH CDB China EXIM Korea EXIM 7

8 Export Credit Agencies (ECAs) in Ship-Finance ECAs assisting Maritime Export Finance What is the role of Export Credit Agencies (ECAs) in Ship Finance? 8

9 ECA backed Ship-Finance (Advantages & Disadvantages) Advantages Commercial Bank: (1) Less Capital Allocation (when ECA funding) (2) Exposure booked as Sovereign Risk (when ECA Guarantee) Shipowner (1) Large amounts of Capital become available (2) Allows capacity in House Banks for non-eca deals Dis-advantages (1) Time consuming (approval process of ECA) (2) 12-year Profile restriction (OECD rules) 9

10 ECA backed Ship-Financing Transactions (Example 1) Miami-based cruise company Royal Caribbean International arranged financing for 1 st and 2 nd Project Icon ships (under construction at Meyer Turku in Finland). USD Loan of up to 80% of Contract Price 1.65 bn ($1.94 bn) each; i.e. estimated total facility of about US $3.10 Billion The loan will benefit from government export guarantees; by Finnvera, the export credit agency of Finland and Euler Hermes, the German export credit agency. Source: Tradewinds, October 18th,

11 ECA backed Ship-Financing Transactions (Example 2) 11

12 ECA (Equipment) backed Financing (Selective Sourcing Provides ECA-cover Opportunities) Members 12

13 ECA (Equipment) backed Financing (Fleet Retrofit Financing - Transaction Examples) Fleet Retrofitting with 100+ High Efficiency Propellers 13

14 Conclusion. Is this World Changing? Shipping in constant Transformation It is not the strongest or the most intelligent who will survive but those who can best manage change. Charles Darwin Shipping Companies: Metamorphosis Diversify Capital Structure Tap different Pockets of Capital available, for different Shipping Projects Evolve 14

15 CASS Business School - 4th Athens Triennial Meeting Is this world changing? Thank You Ioannis Alexopoulos Eurofin Group of Companies.: London.: Athens.: Singapore Eurofin Eurofin S.A. Seafin 15