The first year for HSH Portfoliomanagement AÖR, which in the summer 2016 took over non-performing shipping loans from Germany's HSH Nordbank, has been tough, shows the 2016 annual report, according to IHS Fairplay.
The company, owned by German states Hamburg and Schleswig-Holstein, suffered a deficit of EUR 505 million and had to make impairments of EUR 470 million due to the hard-strained portfolio of loans totaling EUR 4.1 billion, which AÖR acquired from HSH in the summer 2016 as part of the restructuring and privatization of the German bank, a process that must be completed before the end of 2018.
"The negative result must be seen in the context of the ongoing shipping market crisis and one-off costs for the set-up of the HSH Poirtfoliomanagement AÖR," says board member Ulriker Helfer, who comes from DVB Bank, according to IHS Fairplay.
AÖR acquired the portfolio of non-performing loans for EUR 2.4 billion. Developments in the container market in the second half of 2016 in particular, dragged down the result, as 62 percent of the portfolio's 251 vessels are container ships, followed by 18 percent tankers and 10 percent dry bulk and multipurpose vessels.
The number of vessels in the portfolio was reduced to 243 by March this year, reports IHS Fairplay.
English Edit: Daniel Logan Berg-Munch