Star Bulk secures $70m in green loan financing for scrubber retrofits

New York-listed dry bulk shipowner Star Bulk Carriers has secured $70m in green loan financing for its scrubber retrofits as part of a $310m loan agreement.

The $310m loan with DNB Bank, as the Mandated Lead Arranger, Facility Agent and Coordinator, along with ABN AMRO, BNP Paribas, Danish Ship Finance, and Skandinaviska Enskilda Banken, as Mandated Lead Arrangers, includes a $70m green tranche which will be used to finance the retrofitting of 50 scrubbers onto vessels in Star Bulk's fleet. The green loan tranche has been certified by DNV GL Business Assurance Services to be aligned with green loan principles.

While scrubbers have become popular with large vessel owners financing these multi-million retrofits has remained something of question mark as they cannot be financed by standard ship mortgage finance.

Read about the economics of scrubbers

"The completion of this financing is an important milestone for Star Bulk and its lending partners, who are pioneering sustainable green loans for dry bulk shipping investments, which aim to promote maritime emission reductions and compliance with the 2020 IMO regulations,” Star Bulk said.

The green loan tranche has a margin of 280 basis points over LIBOR and an amortisation profile of 4.5 years.

Posted 10 October 2018

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Marcus Hand

Editor, Seatrade Maritime News

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