Shipping financing plays an ever increasing role in today's shipping industry environment, especially after the credit crunch observed these last few months, on the heels of the subprime market crash down. This was among the issues discussed in the "Day of Shipping Financing 2008", organized by the Union of Banking and Financing Employees of the Hellenic Shipping industry, held recently in Athens. The moderator of the meeting was Mr. George Xiradakis, Secretary General of the Union, while the opening speech was given by the President of the Union, Mr. Alexandros Tourkolias. He highlighted the growing need of the Hellenic maritime industry of competent and skilled maritime economists, something that very few University scholars and professors realized some years ago, among which Mr. Konstantinos Gramenos (Vice Dean of City University, Cass Business School, UK) and Ioannis Tzoanos, currently Secretary General of the Ministry of Mercantile Marine, The Aegean and Island Policy, who were also honored in the event.
Mr. Gramenos was recently elected Vice President of the Committee in charge of the newly founded International Hellenic University in Thessalonica. In his speech, Mr. Gramenos focused in the extent of the credit crisis in the market and the difficulties of assessing its full impact and depth. He declared himself a defender of the traditional ways of financing, but without condemning the technological advantage offered in financial institutions the techniques of developing financial engineering, in raising funds. In fact, financial engineering is held responsible for achieving a growth rhythm of over 13% during the last decade for the financing sector. The subprime crisis can be attributed to a number of factors, he said, among which the incomplete framework of supervisory authorities, especially in the U.S.A., but also the arrogant behavior of bank executives, who received huge salary bonuses from practices like loan securitization. As for the impact of this crisis in shipping, Mr. Gramenos said the famous shipping circles haven't seized to exist and that the most worrying and negative concurrence would be the direct link of this negative climate in financial loan markets with the freight market. After all, the funds needed to build the current new building orderbook in shipyards around the world are estimated to a stagerring $490 billion. In this environment, all financial institutions should perform precise credit ratings on their future clients, based on the five basic principles, known as the 5Cs of Credit (Character, Capacity, Capital, Collateral and Conditions).
From his part, professor Ioannis Tzoanos, started his speech on the developments which influenced the institutional framework of the shipping industry and the financial markets. He pointed out the presence of Hellenic and international major bank groups that finance Hellenic ship owners and play a critical role in shaping a new and radical company structure among these shipping companies. He also stressed the necessity to intensify efforts to attract more youth to shipping professions and reinstitute the social status quo of the seafarer, by fighting practices like penalizing sea pollution caused by maritime accidents. One of the important initiatives that the Ministry has under way is the creation of a maritime cluster in Piraeus, whose significance is very big. The successful contribution of the Hellenic maritime financing industry is essential towards this direction, especially after taking into account the growing turn of maritime companies in the stock market, in order to raise funds.
|
