Anatomy of Ship Finance

– Borrowing in a down market –

With freight markets struggling, and the World banking sector still reeling under regulatory controls introduced following the "Credit Crunch", how will shipowners find the money to finance vessel acquisitions? While it may be obvious that the time to buy a vessel is when the values are low, it is also the time when the banks have a reduced appetitie for lending. As commercial bank debt remains the main vehicle by which shipowners finance their fleets, how will owners bridge the gap between need and availability?

Bank lending, however, is only one of a number of alternative means to raise capital, most of which are investigated during the residential "Anatomy of Ship Finance" course. All of the major issues of ship finance will be covered by the lecturers, each of whom has considerable experience in the business. Designed to be thoroughly practical, the course is an ideal way to make new contacts whilst at the same time developing a deeper understanding of financing methods and industry practices. Issues to be discussed include:

  • What financial structure is best suited for different risk exposures?
  • What forms of security are required?
  • What happens when it all goes wrong?
  • What protection do lenders have to avoid losses?
  • What are the early signs of default?
  • What action should be taken and by whom?
  • How is the value of a loan recovered?

The course has been further refined with the addition of a business game based on the relationship between a shipowner and a bank. The game deals with negotiation, credit risk, loan offers, client relationships and fleet expansion.  It consists of a series of dynamic responses to market driven events which include options to finance using different strategies and to choose how to deploy the fleet using a variety of chartering and S&P alternatives. Team competitiveness and a realistic set of parameters ensures that participants receive practical benefit from their given task.

Course information

11–16 October 2020
Jesus College, Cambridge

Jesus College

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The current fee for this residential programme is £4,500 (£3,750 plus £750 UK Value Added Tax) and covers tuition, documentation, private en-suite accommodation at Jesus College, all meals and a social programme.

The course has given me an excellent insight into the process of ship financing as well as the mentality that a banker/financier and shipowner operate with.

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