Banks loath to foreclose loans to shippers-Standard.
Banks will be "reluctant" to foreclose on loans to the shipping sector until market conditions improve, a senior official with Standard Chartered said on Thursday. "Banks will be reluctant to bring down the cards. They will try to ride out the storm," Nigel Anton, Standard Chartered's managing director and head of shipping finance, said at a conference.
"Once you trigger a default there will be serious blood on the carpet."
Lending to shipping companies has dried up after peaking at around $120 billion in 2008 as 90 percent of the world's traded goods by volume are transported by sea and the international economic downturn has hit the shipping industry hard.
But lenders would not want to call up lending to shippers under poor market conditions, which would result in losses.
Anton described his company as a new market entrant and its focus on growth in the Middle East and Asia.