The world shipping industry may face the “most dangerous scenario of all” if European banks limit access to trade finance, restricting commodity traders from opening letters of credit, ICAP Plc’s shipbroking arm said, Bloomberg reports.
Further curbs on lending so banks can meet capital-ratio requirements would hurt small and medium-sized companies, affecting shipping and physical-commodities markets, ICAP Shipping International Ltd. said in a monthly report e-mailed today.
“We are concerned that a significant reduction of short- term credit to the real economy could be the next major step taken by many banks,” the shipbroker said. “While a short-term lending crisis may not seem imminent, it is not altogether impossible.”
ICAP Shipping’s parent company is the biggest broker of transactions between banks.
Further curbs on lending so banks can meet capital-ratio requirements would hurt small and medium-sized companies, affecting shipping and physical-commodities markets, ICAP Shipping International Ltd. said in a monthly report e-mailed today.
“We are concerned that a significant reduction of short- term credit to the real economy could be the next major step taken by many banks,” the shipbroker said. “While a short-term lending crisis may not seem imminent, it is not altogether impossible.”
ICAP Shipping’s parent company is the biggest broker of transactions between banks.