The shipping segment remains a burden to Nordea, which presented its financial statements for the third quarter on Wednesday. Though the provisions from future losses in the segment have gone down from 63 million Euros in the second quarter 2012 to 54 million Euros in the third quarter, the segment is still presented as one of the bank’s challenging areas.
“The tanker and dry cargo markets have been hit hard due to lower global demand and overcapacity, which has affected freight rates negatively. This has caused further deterioration of collateral values during the first nine months of the year and increased the need for additional loan loss provisions. The reduced investment appetite for shipping assets and banks’ lower willingness to lend to shipping companies has made restructurings more difficult,” writes the bank in its statements.