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14/05/18 10:04

One billion non-performing Italian loans still on sale

An analyses by VSL shows that more than 50% debts made by shipowners are listed as NPL or UTP

For the time being overall 1 billion dollars non performing loans granted the shipping business are on sale, while Banks already sold financial speculators overall 1.6 billion.

The present situation was attentively analysed at latest Mare Forum Italy 2018 by Fabrizio Vettosi, General director of Venice Shipping & Logistics,

The skilled analyst illustrated the development of shipping loans, showing how the traditional Bank loans dropped by 4.8% from 2011 to 2016, going down from 370 to 319 billion dollars globally, while the global fleet was enhanced.

Unicredit is one of the most efficient Italian banks as far as the shipping market is concerned, however since 2008 they downsized loans by 6.5 billion dollars, going down to 4.4 billion globally in late 2016.

Traditional European bank-loans were replaced by other Asian Banks and particularly by Chinese leasing companies which recorded a sharp increase in loans granted shipping companies and reached 5.6 billion dollars in mid 2017 (recording 62% average growth since 2007).

According to Vettosi investment funds grabbed in Italy a large number of non performing loans granted shipowning companies, the major ones were: Pillarstone Italy, Taconic Capital, Goldman Sachs, Deutsche Bank and Attestor Capital.

According to Clarksons, the whole fleet controlled by italian shipowners is currently worth 34.5 billion dollars (18 billion covering ro-pax and cruise ships) while, according to VSL's data, overall shipowners' debts with Banks has currently reached 14 billion dollars, half of which (7.6 billions) are Non Performing Loan (or ‘Unlikely to pay’ debts) almost exclusively referring to bulk carriers and tankers.

The reason why many Italian shipping companies were forced to renegotiate debts with banks was justified by the Loan to value index (one of the covenant often listed by Banks within shipping funding contracts) which reached 189% for bulk carriers financed before the financial crisis and 144% for tankers, thus generating substantial depreciations in shipping companies and Bank financial statements.

VSL's General manager also compared the domestic fleet with the Greek one (European leading country), showing that the value of ships owned by Italian shipowners stands at 34.5 billion dollars  (106.6 is the Greek fleet) while overall Italian capacity reaches 43 million (Greece records 217.1 million).

Italian ships (the majority of which are cruise ships, ferries, chemical tankers, etc..) are more sophisticated as showed by the average value/tons which stands at 0.8 million dollar for Italian ships and 0.49 million for Greek units. Furthermore, 16.1 million out of 43 million Italian fleet is flying the Italian flag while left 26.9 is flying a foreign flag.   

Nicola Capuzzo     

TAG : Finance
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