König calls on Asian banks to bridge ship finance gap

Mumbai: Tobias König, md at König & Cie, has stressed the need for Asian banks to come to the aid of the shipbuilding industry. Speaking at the fourth annual Seatrade and Tradewinds co-organised Indian Shipping Summit in Mumbai yesterday, König identified the current global situation as a "financial emergency".

"Most European banks, including the major German lenders, have closed their books and the market lending situation is very tight," he said. "Based on our calculations, we only expect the ship finance market to bounce back in the second quarter of 2009."

"If you look at the shipbuilding market, you realise that all the key players are based in Asia: Korea, China, Japan, Vietnam and increasingly, India. But the Asian banks have not even made it into the top ten list of ship financers.  I am not saying that they should look at financing vessels to be constructed in Germany, but they urgently need to step up to solve the problems that the Asian builders are going to have to face in a market where cash really is king."

According to König, the rapidly changing face of the ship finance sector presents a unique opportunity for Asian lenders willing to move fast to aid builders. "The credit crisis is only going to increase which will force banking to work under new regulations," he said adding that he expects a lot of banks to disappear or merge under the new regime and that the increasing cost of capital acquisition will be passed onto customers ?" a harsh outlook in light of the number of financial heavy weights that have found themselves in deep waters over the past few months.  [01/10/08]