Lloyd’s Ship Finance Conference Wrap-up

Whether you believe that junk bonds are a revolutionary step for the shipping industry or that good judgment has been eclipsed by a high tanker market courting a cash-laden fund managers, you would not have been alone at this year’s Lloyd’s Shipping Economist finance conference.

While the vast majority of the papers had nothing to do with high yield debt, “junk” got a lot of attention. The reason may be that, while there have been a plethora of changes in the shipping industry (consolidation, ISM, STCW, OPA, to name a few), there have not been so many changes in the banking industry, unless one considers the erosion of spreads as new, and the majority of delegates were bankers. While there have been periods when shipping companies have gone from “golden child” to the “whipping boy” of the capital markets, the pipeline of high yield deals is presently full and if you believe that the market speaks, what it has said this year is “More, Please.”

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