Deutsche Bank Shipfinancing (DB Shipping) remains on course for success. Managing Directors Ralf Bedranowsky, Annemarie Ehrhardt, Torsten Wagner und Tjark H. Woydt presented the 2007 annual financial statements of DB Shipping in Hamburg. DB Shipping is made up of Schiffshypothekenbank zu Lübeck AG (SHL) and the ship financing department of Deutsche Bank AG.
"DB Shipping turned in another record profit in the financial year just ended", reported Tjark H. Woydt. Regular income grew by 5.5 million or 10.8 percent to 56.5 million, which was the best result ever achieved by Deutsche Bank's ship financing operations. Pre-tax profit stood at 47.3 million, reflecting an increase of 4.6 million or 10.8 percent over the preceding year. The share of non-capital-related income stabilized at a level of 40 percent. Management was highly satisfied with the results achieved in an environment marked by competitive pressure and the recent financial crisis.
New lending showed a positive development. In 2007, the volume of drawings rose to 2.2 billion compared with 1.6 billion in 2006. Some 70 percent of the traditionally well diversified DB Shipping loan portfolio was made up of investment-grade lending, explained Annemarie Ehrhardt. Once again, customers' excellent creditworthiness meant that no provisions for loan losses had to be formed in 2007.
"2007 was definitely a good year for the shipping industry", said Ralf Bedranowsky. As in the previous year, growth in 2008 is expected to be underpinned by business with Asia, above all China and India. He described 2007 as a record year for the dry cargo shipping industry (bulk carriers). Charter rates, ship values, ship newbuilding prices and shipyards' order books set new records. Charter rates reached historical peaks owing to continued strong demand for iron ore from China and worldwide demand for coal, and remained at high levels. An increasing supply of tonnage expected between 2009 and 2012 is likely to cause charter rates to decline.
The medium-term outlook for the offshore drilling market was also positive, according to Bedranowsky. Demand for mobile oil rigs and drilling ships has risen steadily over the past two years as a result of persistently high oil prices. Demand is expected to climb further in line with growing oil consumption. This will be of special benefit to units equipped to work under extreme circumstances such as deepwater drilling in regions which present difficult environmental challenges.
The turmoil on the financial markets over the past few months caused perceptible uncertainty among shipowners and operators. Torsten Wagner gave his assurance that "in this situation DB Shipping remains fully committed to its lending operations and faces the new financial year with great confidence." Besides its operations in traditional markets in Germany and Scandinavia and plans to build up staff at its agency in Piraeus, DB Shipping intends to focus on the newly developing Asian markets. A DB Shipping team is to be set up in Singapore as a major regional centre.
Alongside traditional ship financing business, other banking products are also gaining in significance: in cooperation with Hamburg-based fund issuer Lloyd Fonds AG, Deutsche Bank placed two funds last year for a total volume of over 300 million. In addition, DB Shipping advised two international shipping companies in the listing for an initial public offering at the Singapore stock exchange totalling some 340 million.
"DB Shipping turned in another record profit in the financial year just ended", reported Tjark H. Woydt. Regular income grew by 5.5 million or 10.8 percent to 56.5 million, which was the best result ever achieved by Deutsche Bank's ship financing operations. Pre-tax profit stood at 47.3 million, reflecting an increase of 4.6 million or 10.8 percent over the preceding year. The share of non-capital-related income stabilized at a level of 40 percent. Management was highly satisfied with the results achieved in an environment marked by competitive pressure and the recent financial crisis.
New lending showed a positive development. In 2007, the volume of drawings rose to 2.2 billion compared with 1.6 billion in 2006. Some 70 percent of the traditionally well diversified DB Shipping loan portfolio was made up of investment-grade lending, explained Annemarie Ehrhardt. Once again, customers' excellent creditworthiness meant that no provisions for loan losses had to be formed in 2007.
"2007 was definitely a good year for the shipping industry", said Ralf Bedranowsky. As in the previous year, growth in 2008 is expected to be underpinned by business with Asia, above all China and India. He described 2007 as a record year for the dry cargo shipping industry (bulk carriers). Charter rates, ship values, ship newbuilding prices and shipyards' order books set new records. Charter rates reached historical peaks owing to continued strong demand for iron ore from China and worldwide demand for coal, and remained at high levels. An increasing supply of tonnage expected between 2009 and 2012 is likely to cause charter rates to decline.
The medium-term outlook for the offshore drilling market was also positive, according to Bedranowsky. Demand for mobile oil rigs and drilling ships has risen steadily over the past two years as a result of persistently high oil prices. Demand is expected to climb further in line with growing oil consumption. This will be of special benefit to units equipped to work under extreme circumstances such as deepwater drilling in regions which present difficult environmental challenges.
The turmoil on the financial markets over the past few months caused perceptible uncertainty among shipowners and operators. Torsten Wagner gave his assurance that "in this situation DB Shipping remains fully committed to its lending operations and faces the new financial year with great confidence." Besides its operations in traditional markets in Germany and Scandinavia and plans to build up staff at its agency in Piraeus, DB Shipping intends to focus on the newly developing Asian markets. A DB Shipping team is to be set up in Singapore as a major regional centre.
Alongside traditional ship financing business, other banking products are also gaining in significance: in cooperation with Hamburg-based fund issuer Lloyd Fonds AG, Deutsche Bank placed two funds last year for a total volume of over 300 million. In addition, DB Shipping advised two international shipping companies in the listing for an initial public offering at the Singapore stock exchange totalling some 340 million.