Bruce Barnard, Special Correspondent | Aug 31, 2012 12:40PM EDT
HSH Nordbank’s first half net income plunged to 70 million euros ($88 million) from 338 million euros ($426 million) a year ago as the German shipping bank, the world’s largest, was buffeted by the deepening shipping slump and the weakness of the euro against the dollar.
The Hamburg-based bank made loan loss provisions of $140 million in the first six months of 2012 and warned the figure will grow as the shipping crisis worsens.
“The further worsening of conditions in the shipping industry in the wake of the global economic downturn and the depreciation of the euro have taken a heavy toll on our figures and will continue to exert pressure on us in the foreseeable future,” Chief Executive Paul Lerbinger said.
The bank said it does not expect the shipping slump to bottom out for another 12 to 18 months, and a gradual recovery in freight rates, time-charter rates and ship prices is unlikely to emerge before the end of 2013.
HSH Nordbank, whose shipping loan book peaked at $38 billion in 2010, got a $41 billion state-funded bailout last year after coming close to collapse in the wake of the global financial crisis in 2008.
Contact Bruce Barnard at brucebarnard47@hotmail.com.
