Maritime
& Shipping Finance

Typical uses of proceeds

• Acquisition of secondhand tonnage
• Refinance of existing vessel debt
• Partial fleet recapitalization or sponsor take-out
• Selected retrofit, dry-dock, and compliance-related capex where residual value supports the advance
• Working capital tied to a financed vessel or a defined pool of maritime receivables

Facility types

Senior secured vessel term loans

Amortizing or sculpted term facilities secured by one or more vessels. Advance rates are a function of age, type, specification, flag and class, independent valuation, employment, and the quality of the security package. Tenor is set to remaining economic life, charter cover, and refinance risk—not to a marketing grid.

Preferred ship mortgage structures

Where the vessel is documented in a jurisdiction that recognizes a preferred mortgage, we expect a first preferred ship mortgage registered with the relevant flag authority, together with a deed of covenants or equivalent where customary. U.S.-flag and Coast Guard-documented vessels are treated with the additional requirements that documentation status demands.

Earnings and insurance assignments

A vessel without assigned earnings and properly endorsed insurances is incomplete collateral. Standard packages include assignment of charter hire and freights, assignment of hull and machinery, war risks, and P&I as applicable, with the lender named as mortgagee and loss payee, and notice to underwriters and, where relevant, the club.

Sale-leaseback and lease-adjacent structures

In selected cases, a sale-leaseback or bareboat structure may be more efficient than a conventional mortgage loan. These transactions are documented as true or finance leases according to the commercial intent and tax/accounting facts, and they require clean title transfer, quiet enjoyment mechanics, and a defined purchase option or residual arrangement.

Maritime working capital

Revolving or short-term facilities against assigned freight receivables, pool distributions, or other contracted maritime earnings, often used alongside a term mortgage on the vessel. Advance rates reflect counterparty quality, dilution, and the enforceability of the assignment.

Security package — what we typically require

• First preferred ship mortgage (or equivalent first-ranking security) on the financed vessel(s)
• Assignment of earnings, charter rights, and requisition compensation
• Assignment of insurances and, where applicable, requisition of title proceeds
• Charge or pledge over earnings and retention accounts, with account-bank acknowledgements
• Share pledge over the vessel-owning company when the borrower is an SPV
• Manager’s undertakings and, where appropriate, technical and commercial management acknowledgements
• Parent, sponsor, or completion support when the owning company is thinly capitalized
• UCC filings and general security over related personal property, spare parts, and claims

What we look at in underwriting

• Vessel type, year, yard, specification, class society, and survey status
• Flag, ownership chain, and any bareboat or dual-registration issues
• Independent valuation and, where relevant, two-broker desktop or full inspection
• Employment: time charter, voyage, pool, or spot; residual tenor and charterer credit
• Operating budget, dry-dock calendar, and off-hire history
• Insurance program, deductibles, and P&I standing
• Sanctions, ownership, and vessel screening
• Jurisdiction of enforcement and insolvency analysis for the owning company

Segments we will consider

Dry bulk, product and crude tankers, containerships and feeders, multipurpose and general cargo, selected offshore support and marine construction equipment, tugs, barges, and other brown-water assets, and certain specialized vessels where residual value and employment can be underwritten. Passenger, high-spec offshore drilling, and highly experimental asset types are outside the core mandate unless the structure and sponsor quality are exceptional.

What we generally will not finance

• Vessels that cannot be mortgaged or whose title is encumbered by undisclosed maritime liens that cannot be resolved
• Parties or vessels that fail sanctions, ownership, or compliance screening
• Speculative newbuildings with no yard, no refund guarantees, and no employment thesis
• Pleasure yachts marketed as consumer boat loans (this is a commercial practice)

Process snapshot

1. Confidential teaser: vessel particulars, ownership, use of proceeds, existing debt, and target close.
2. Preliminary indication: whether the file is in mandate, and what information is required next.
3. Term sheet: commercial terms, security, conditions precedent, and exclusivity if appropriate.
4. Diligence and documents: valuation, legal opinions, mortgage form, insurance brokers’ letters, KYC.
5. Funding: registration of security, conditions precedent satisfied, advance.