Ship financier DVB Bank believes most newbuildings ordered at Asian shipyards will be delivered, despite the difficulties in raising funding.
Newbuildings ordered at Asian shipyards will be delivered, despite the difficulties in raising funding. Dagfinn Lunde, member of the board of managing directors for DVB Bank said the newbuilding orderbook due for delivery in 2009 had been financed, despite fears that it would not be.
He explained that as newbuildings were already financed by the yard constructing the vessel, if the owner could not afford then to pay the yard, the bank will be stuck with the newbuilding. Shipowners are also getting finance from export credit banks in shipbuilding countries.
So far in 2010 Lunde states that newbuilding deliveries have been seen every day and that cancellations have come largely from the yards where there was a failure as per the contract over terms such as delivery date.
He noted that it was not easy for owners negotiate with the South Korean yards even if they ordered newbuildings at ?horrible? prices as the values of some types of vessels have dropped by as much as 50% over the last 18 months. However owners have been able to negotiate delivery delays as yards seek to ensure they have work in future years as new orders dry up.