Dutch lender NIBC has seen its shipping loan book shrink further as cash-rich owners pay off debt more quickly.
The bank said the maritime portfolio stood at €955m ($1bn) on 31 December, down from €1bn on 30 June last year, and €1.12bn at the end of 2022.
Despite higher loan pre-payments in shipping, the total asset-based finance portfolio increased, mainly due to strong growth of 22% within digital infrastructure.
CEO Paulus de Wilt said: “Within asset-based finance, we continue to explore new financing opportunities.”
Dry bulk lending rose to 36% of the portfolio, from 33% a year ago, while gas carriers and chemical tankers also hit 36%, from 35% in 2022.
Crude and product tanker lending now makes up only 6%, from 12% previously, while intermodal and other shipping types accounted for 22% of the book, from 21%.
The bank reported no impaired loans at year-end, while non-performing exposure was €35m in 2022, with impaired exposure at €19m.
The expected credit loss for 2023 was €6m, unchanged from last year.
The weighted average loan-to-value of the shipping portfolio is 41%.
The EU Emissions Trading System (ETS) became applicable to shipping companies on 1 January this year.
“NIBC monitored these developments throughout 2023 and in certain cases engaged external experts to conduct professional education sessions for our teams to build knowledge and awareness,” the lender added.
Energy transition financing
The bank said last year it financed the first vessel with fixed airfoils — wings which allow a ship to benefit from wind power, reducing the reliance on fossil fuels.
“As part of our climate transition strategy, we encourage our corporate clients to set Paris-aligned emissions targets and develop practical transition plans, which pursue practical decarbonisation levers,” the lender said.
“For example, we support shipping clients in their acquisition of dual-fuel vessels and/or use of low-emission fuels. We encourage strategies which reduce fuel consumption and emissions such as slow-steaming, regular hull cleaning and other actions,” it added.
Net profit for the year was up at €204m, from €155m in 2022.
Operating income rose to €545m from €473m year-on-year.
