ShippingWatch

Equity funds could make big money on shipping

Private equity and hedge funds are expected to keep taking on large-scale shipping loans from big banks in 2014, and at solid discounts, according to several financial consultants.

Several major banks have sold off their shipping loans to equity funds during the last months of 2013, often at 15-20 percent discounts, and this development will continue in 2014, financial consultants estimate. And with a stabilization or increase of ship values the equity funds with strong capital backing - and as opposed to many banks - could do solid business, as some hedge funds have already done this year.

For the individual companies and carriers, which could get new, perhaps more impatient creditors, the future might become more uncertain and demanding in case they fail to comply with the maturity dates on their loans.

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