Shipping finance

Shipping finance

This overview is a guide to the Banking & Finance content within the Shipping finance subtopic, with links to appropriate materials.

What is shipping finance?

In simple terms, shipping finance transactions (a form of asset finance) involve a lender providing funding to a borrower for the purchase of a vessel (which is either a new-build vessel under construction or a vessel that already exists and which is being purchased by the borrower as a second hand vessel) or to refinance existing indebtedness already in place in respect of a vessel. The lender will look to put itself in the best possible position both in respect of the initial security position following the provision of finance and then in the subsequent operation of the vessel. The term is not used to refer to the financing of shipping businesses or operations (other than the acquisition or refinancing of a vessel).

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Standard form documents in relation to shipbuilding contracts have developed globally, such as the SAJ (the Shipbuilders' Association of Japan) and BIMCO (the Baltic and International Maritime Council) NEWBUILDCON, which are the main forms used in the market. The main

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