New Greek Bankson the Block

By Kevin Oates

All of us involved in the world of ship finance bemoan those times when a bank, long-time or short- time provider of finance to shipping, decides to step down and focus on other activities. On the other hand, new entrants are welcomed with open arms. What is peculiar about shipping finance is that there is a vital niche for all providers of finance to fill. From global banks focusing on the global shipping players with strong balance sheets and new vessels, to the small, local or provincial bank which will only lend to clients in it’s own “back yard” and with whom it has a long and lasting relationship. Such banks may be willing to lend to owners with fewer, and perhaps older vessels, based on past performance and reliability.

In Greece over the past few years generally speaking the number of banks involved in lending has reduced. Not that the amount of lending has diminished. Far from it. Those fewer banks that are left are lending more and more as the Greeks renew their fleets and order newbuildings. But the number of banks are fewer and therefore the choice of financing partner is more restricted. Some of the banks which have closed their offices in Greece include National Westminster Bank (acquired by Bank of Piraeus), Credit Lyonnais (acquired by Bank of Piraeus – to be noted is that Credit Lyonnais’s shipping business is still represented in Greece by XRTC Ltd), Banque Cantonale Vaudoise, Den norske Bank and Bank of Nova Scotia (acquired by First Buisness Bank – see below). Of the above all but National Westminster still do some business in Greece from head office, but on a much more selective basis and with only the top tier of shipping companies.

Thankfully, a couple of banks have also opened up to entertain some ship finance over the last year. First Business Bank (FBB) opened it’s doors just over a year ago and after spending a few months finding it’s feet, during 2002 committed about $150 million. Aegean Baltic Bank (AB Bank) was being talked about from the Spring of 2002 but only opened for business in November 2002. However with a partner like LB Kiel and long-time shipping expertise in top management, it is likely that it will not take long for them to make their presence felt.

This is only an excerpt of New Greek Bankson the Block

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