Sanctions against Russia look to have claimed their first ship finance scalp with Amsterdam Trade Bank (ATB) filing for bankruptcy.
“UK and US sanctions have caused operational difficulties, as the majority of ATB’s counterparties, including corresponding banks and infrastructure providers, find it difficult to continue supporting ATB,” the bank said in a statement.
Amsterdam District Court has appointed A. van Hees and J.E.P.A. van Hooff as bankruptcy trustees.
ATB is a subsidiary of Russia’s Alpha Bank which has been subject to US sanctions but has not been targeted by the European Union.
According to filings at the Dutch Chamber of Commerce, the bank’s ultimate beneficial owner is Mikhail Fridman, the Russian-Israeli billionaire who is contesting Western sanctions imposed on him following Russia’s invasion of Ukraine. His stake in ATB was said to be more than 25% but no more than 50%, Reuters reported.
Dutch media had previously reported that ATB’s owners were seeking to sell the bank and depositors discovered that other European banks were unwilling to accept transfers out of ATB for fear of falling foul of sanctions.
ATB was founded in 1994 and is focused on the entire spectrum of international commodity finance as well as shipping and asset-based financing.
The bank says it serves a wide spectrum of customers active in all aspects of international trade, whether commodity traders, ship owners or companies otherwise involved in the global logistics chain.
According to its 2020 annual report, the most recent on record, ATB had assets of around €1.2bn ($1.3bn) and equity of €174m. It made a profit of €27m that year.
The shipping portfolio is spread across multiple sectors: bulkers account for 20% of the portfolio, product tankers 28%, chemical tankers 20%, container ships 13% and LPG and LNG carriers around 19%.
However, the bank has said that it was not actively expanding its shipping portfolio anymore.
SGM Shipping, the Swiss-based asset management and investment services, said many shipping companies were working with ATB.
“Perhaps some had important collateral cash guarantee accounts,” it said in a posting on social media.
“We may see a cascade effect of this forced bankruptcy on some mid-size shipping companies, and some sizeable shipping loan portfolios for sale.”
ATB was one of the founding signatories to the Poseidon Principles, the global framework for assessing and disclosing the climate alignment of financial institutions’ shipping portfolios.
However, in its most recent annual report it said its ship finance portfolio was found to be out of alignment with the emissions reduction principles set in the Poseidon Principles.
