DVB’s Schiffspfandbrief

On Monday, DVB announced that its first ship covered bond issue or Schiffspfandbrief was successfully placed last week by joint lead managers, DZ Bank and Deutsche Bank.  The bank issued EUR 250 million of three year 2.25% bonds, which were sold at 99.702%, equivalent to a spread of 50 bps over mid-swaps. The bond is collateralized by a pool of 56 eligible shipping loans, secured by first mortgages, of approximately $1.01 billion in principal amount representing a cross-section of DVB’s shipping portfolio. The cover pool consisted mainly of product tankers (21%), bulk carriers (18%), crude tankers (18%) and containerships (15%).  The bonds were rated Aa3 by Moody’s. Purchasers, solely banks, placed 56 individual orders, with 90% placed in Germany and the balance in Austria and Luxembourg. By choosing this refinancing vehicle DVB has expanded its investor base and funding sources, which these days is a good thing.

A Noble Breed

Last week, our sister publication Freshly Minted reported on Maersk’s successful EUR 750 million (USD 1.3 billion) five-year bond. This was the shipping conglomerate’s first bond issuance, following a recent equity offering of USD 1.7 billion. In Asia, commodity trading house Noble Group has likewise found tremendous success in raising funds, suggesting that investors and bankers are getting warmed up to investing cash again. Continue Reading

More Normal?

Dealogic released its first half tables on Wednesday and they resembled, at least in terms of names, what we more typically expect, particularly in the case of the bookrunner table. Nevertheless, the newcomers from the 1st quarter did retain positions on the leader board. Total deal value grew to $17.5 billion comprised of 50 deals, versus the year earlier $43.1 billion comprised of 165 deals, continuing an expected trend. However on a quarter over quarter comparison, transaction volume declined a substantial 47.3% this year marking an even more worrisome trend.

The top 20 bookrunner table underwent the most change as it filled out from 8 banks in the first quarter to 17 in the first half. SMBC held on to first position increasing its volume by 71% and its market share to 6.5%. Nordea returned jumping to 2nd place with a 3.5% market share. SBI Capital fell to 3rd place with Mizhuo and DnB NOR rounding out the top 5. DnB Nor’s placement is significant and representative of its size and importance as its lending, oft repeated, is strictly limited to run-off. In addition to Nordea, the usual European suspects are back, including KfW, BNP Paribas, HSBC, Deutsche Bank, Citi, SG CIB and Calyon. RHB Investment Bank of Malyasia and Axis Bank of India were new entrants and added to the already significant Asian representation.

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