Changes in Global Shipping Finance: Causes and Consequences
DOI:
https://doi.org/10.46299/j.isjmef.20240306.04Keywords:
Shipping, Shipping companies, Banks, Uncertainty conditions, Risks, Corporate strategy, Investments, FleetAbstract
The article is devoted to the analysis of changes in the global shipping finance under today's unstable political and economic conditions. The author identifies the problem of the riskiness of shipping finance and the main reasons of the lending reduction by the banking sector. It has been found that defaults and recoveries of marine loans are usually caused by volatile freight rates. The dynamics of sea transportation and shipping credit volumes in 2006-2023 were analyzed and it was determined that the growth of transportation in recent years did not cause an increase of the lending volume, which is primarily explained by the new Basel standards. By comparing the Petrofin Global Index and the Global Fleet Growth Index dynamics in 2008-2023, it was concluded that only 42% of fleet expansion is due to traditional bank lending. The analysis of alternative sources of financing for shipping allowed us to reveal the advantages and disadvantages of attracting capital through the issuance of shares and bonds, the use of leasing schemes (solo or in combination with other debt instruments), hedge funds and investment platforms. The dynamics of share prices of the TOP 4 shipping companies, which are considered to be the most attractive for investment at the end of 2023, have been analyzed. An attempt to single out the main factors affecting the dynamics of quotations of shares of companies in the shipping industry was made. The growing role of Direct Lending, especially in the field of shipping finance - has been identified. Conclusions were made regarding the prospects and restraining factors of the development of direct lending, such as the need to form platforms for related services. The study provides an opportunity to consider the problem of shipping finance from a wider angle, to identify new alternative ways of development.References
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