Not a Loan in the Syndication Market

“When you need a loan, you are alone,” a good friend said to me the other day as we were discussing shipping’s credit crunch. With spreads soaring, upfront fees skyrocketing, and banks using market-flex language in shipping deals to ensure they don’t end up holding more paper than they are comfortable with, it seems like a lender’s market. While this may be true, it is probably of little comfort to Royal Bank of Scotland, which is arresting the 22-ship Lygnos fleet, or to Nationsbank, First National Bank of Maryland or FinansBanken, which are all thought to be considering an exit from shiplending. Nevertheless, where there is turmoil there is opportunity, and deals are being done, though less in the bulk market than other areas.

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