Ship financing: Past, Current & Future How capital raising has been changing

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1 Ship financing: Past, Current & Future How capital raising has been changing Pål Hauge Senior Vice President Tanker Group 7 TH Chemical & Product Tanker Conference - London 17 March 2015 Slide 1

2 Agenda DVB Ship Finance in brief Ship Finance in the past Current availability Ship Financing going forward Slide 2

Introducing DVB Listed: Frankfurt Stock Exchange Market capitalisation >EUR 1.

45%) by DZ Group, the largest co-operative banking group in Germany DVB Facts EUR 23 bln loan book Over 500 clients,

Presence Through 12 Offices Bank Structure Shipping Aviation Land Transport New York Oslo Cardiff London Hamburg

3 Introducing DVB Listed: Frankfurt Stock Exchange Market capitalisation >EUR 1.1bn Rated A+ for long term debt by S&P/Fitch (August 2012) Majority owned (95.45%) by DZ Group, the largest co-operative banking group in Germany DVB Facts EUR 23 bln loan book Over 500 clients, all active in the transport sector, worldwide Over 500 professionals, all specialising in transport finance Global Presence Through 12 Offices Bank Structure Shipping Aviation Land Transport New York Oslo Cardiff London Hamburg Amsterdam Frankfurt Zurich Athens Tokyo Curacao Investment Management Singapore Investment Banking Structured Asset Finance Risk Distribution Loan Participations Research in Shipping, Aviation and Land Transport Slide 3

DVB s business areas and products Business divisions Shipping Finance Aviation Finance Offshore Finance Land

Intermodal & Ferry Tanker Group Dry Bulk Passenger aircraft Freighter aircraft Aircraft engines Offshore

Accommodation units Offshore drilling equipment Floating production units (FPSOs) Fondsmanagement: Shipping

Structured Asset Financing Risk Distribution Advisory Services Equity & Public Debt Client Account

Management Aero Engine Financing & Engine Asset Management Client Account Structured Asset Financing Risk

Distribution Advisory Services Equity & Debt Capital Markets Client Account Private Equity Sourcing &

4 DVB s business areas and products Business divisions Shipping Finance Aviation Finance Offshore Finance Land Transport Finance Investment Management ITF Suisse Business areas Sector groups: Container, Car Carrier, Intermodal & Ferry Tanker Group Dry Bulk Passenger aircraft Freighter aircraft Aircraft engines Offshore support Rail rolling stock vessels (PSVs and AHTSs) Subsea & construction vessels Seismic vessels Accommodation units Offshore drilling equipment Floating production units (FPSOs) Fondsmanagement: Shipping & Intermodal Investment Management Aviation Investment Management Interbank market Products and services Structured Asset Financing Risk Distribution Advisory Services Equity & Public Debt Client Account Structured Asset Financing Risk Distribution Advisory Services Equity & Debt Capital Markets Aviation Asset Management Aero Engine Financing & Engine Asset Management Client Account Structured Asset Financing Risk Distribution Advisory Services Equity & Debt Capital Markets Client Account Structured Asset Financing Risk Distribution Advisory Services Equity & Debt Capital Markets Client Account Private Equity Sourcing & Investments Loan Participations (senior asset-based lending) Asset & Market Research Demand outlook - for chemical, LPG & product tankers Slide 4

5 DVB Tanker Group Shipping Portfolio of DVB is USD 12.3bln as of December 2014 (excl Offshore) of which USD 5.4 bln in Tankers (approx 44% of Total Portfolio) USD 1.0 bln exposure in Chemical Tankers (8%) and USD 1.4 bln in Product Tankers (11%) Team of 14 highly experienced shipping bankers Strategically represented in Greece, Norway, Singapore, United Kingdom and United States Finance > 300 chemical & product tankers for approx 65 owners Closed 35 transactions in 2014 with new loan volume of USD 1.6 bln Slide 5

6 Shipping Finance In-depth expertise Container, Car Carrier, Intermodal & Ferry Group (container vessels, container boxes, car carriers, reefers, ferries and RoRo s) Tanker Group (crude oil and LNG 1) tankers as well as chemical, specialist, LPG 2), product and asphalt/bitumen tankers) Dry Bulk Group (dry cargo, combination and bulk carriers) Demand outlook - for chemical, LPG & product tankers Slide 6

7 Ship Finance Not particularly different from other types of fixed asset finance Key word is MORTGAGE Slide 7

8 Ship Finance Forms and Shape Equity Private Public Debt Bank Public ECA Hybrids Convertibles Leasing Slide 8

9 Ship Finance Availability Drivers Liquidity Market expectations Secondhand values Shipbuilding prices Alternative investments 800 % 700 % 600 % 500 % 400 % 300 % 200 % 100 % 0 % Regulatory issues World Contracting $ Million Secondhand Price Index USA Interest Rates % Newbuilding Price Index ClarkSea Index $/Day Fleet Development Slide 9

10 Recent trends in Ship Finance Slide 10

11 Ship Finance Going forward Challenges The regulatory environment Ability to provide sustainable profitability Oversupply Inflated asset values Lack of discipline Slide 11

12 Ship Finance Going forward Opportunities Low interest rates More capital providers than ever Certain assets are being priced at historical lows Sources Equity Debt Hybrids Leasing Slide 12

13 Thank you for your attention! Slide 13

FOCUSED. DIVERSIFIED. COMPETENT. TRUSTWORTHY. Tanker financing boom or bust?

FOCUSED. DIVERSIFIED. COMPETENT. TRUSTWORTHY. Tanker financing boom or bust? ALMC - Asian Logistics and Maritime Conference, Hong Kong 23. November 2017 Disclaimer This presentation has been prepared by