Status quo of German and international ship financing

摘要

In the old days, equity capital and a bank loan were needed to finance the acquisition cost of a vessel. Whilst, historically, the owner of a ship usually held an equity share of 50 %, the ratio between equity capital and bank loan dropped to 30/70 and in some cases as low as 20/80 or even 10/90.rnFor many years, the German ship financing community had almost unlimited access to equity capital. The German KG market - unique in the world on account of its structure and capacity - pumped enormous amounts of equity capital into the shipping markets, enabling shipowners and managers to order newbuildings. In many cases, vessels were ordered on the back of the availability of finance as opposed to the availability of employment. The KG market was functioning so reliably for decades that German banks even became willing to grant equity pre-financing bridge loans. The commonly known, dramatic decline in the equity capital placing volume since autumn 2008 caused financing gaps in many transactions.