We offer our clients tailor-made financing in all customary currencies for the construction of vessels and for the purchase of second-hand tonnage.

Mortgage Loan

The terms and conditions vary, depending on the standing of the owner and the particulars of the deal such as vessel type, employment and age of the ship. Our loans are generally secured by first priority ship mortgages which are entered in the acceptable flagging juridiction. Main characteristics

Tenor: match client needs (up to 12 years for standard vessels)    Financed amount: between 60 and 95% depending on employment foreseen Interest rate: a fixed / floating rate or any relevant hedging agreement   Security package: determined by the lenders on a case by case basis (usually a first priority mortgage over the vessel and payment assignments of income and of insurance).

Advantages

Quick answer for the pre-qualification of your financing for all standard vessels    Backed by the financial power of the Bank and its skill spread over the worldwide network, we have also an economic analysis with gathering intelligence on the Asian Shipyards    Simple loan documentation generating reduced legal and other costs

Export Credit and Co-Financing

Main characteristics

Tenor: fixed by the Export Credit Agencies (ECA ’s) according to the amount and nature of the project (up to 12 years)    Financed amount: around 80% of the Commercial Contract after 20% downpayment (also depending on country of origin of supplied equipment)    Interest rate: either a fixed rate as determined each month by the OECD consensus (CIRR) or a floating rate.    Security package: determined by the lenders and the relevant Authorities on a case by case basis (usually a first priority mortgage over the vessel and assignments of earnings).    Repayment: usually 12 years on a full pay out basis    Percentage of loan guaranteed by ECA: up to 100% of financed amount    ECA premium (included in the financing) as determined by the relevant ECA

Advantages

Fixed CIIR Interest rate usually more advantages than markets rates Buyer's borrowing capacity on the market spared for that portion guaranteed by ECA Simple loan documentation generating reduced legal and other costs ECA insurance cover allows large financing

Position

BNP Paribas is in a Top tier banks for arranging Export Credit transactions    BNP Paribas is the leader on the French market    BNP Paribas is the leader US EXIM on the first semester

Tax leverage lease structures

We set up tax leverage lease structures : French tax lease, UK tax lease, US tax lease and Japanese Operating Lease. Main characteristics

A tax lease is one of the most structured schemes. It reduces dramatically the equity needed in a project by involving an investor  who will make tax benefits.    On the lessee side (the shipowner): the shipowner gives a package of commitments and save from 6% to 25% of the total project amount. Typical commitments are, amongst others, to keep the vessel for a quite long period of time (between 8 and 25 years) and to operate the vessel from a given country (UK, France, Japan …).    From the lessor viewpoint (usually financial institution) utilises capital allowances (depreciation under specific tax law) to realise taxable losses during the early years of the leasing transaction which are offset against the Lessor Parent’s Group profits.    Creating a deferred tax liability is equivalent to overall paying the same amount of tax in terms of nominal value but with a time lag. On a net present value basis, it means paying less tax and that is the benefit shared between the lessor and the shipowner.

Advantages

High investment cost reduction (up to 20% of the acquisition price)    Well-know type of financings by the lending and tax investors' market    Long-standing and deep experience of those types of financings    Preservation of quiet enjoyment of the ship and operational flexibitly for the shipowner

Position

BNP Paribas is the largest tax capacity provider on the French tax lease market    As a lead arranger of French tax lease, BNP Paribas Capstar Partners has a strong experience of the syndication market and enjoys a broad syndication base    BNP Paribas Capstar is a market leader for UK tax lease arrangement

Hedging products

Freight hedging It comprises two complementary trading and risk management activities: - Commodity Futures is a client-focused business providing clearing, execution and margin finance services of freight on the LCH - Commodity Indexed Transaction Group trades as principal in the global commodity market, on an exchange and Over-The-Counter (OTC) basis. Bunker hedging Energy prices are subject to a number of influences, from the weather to supply/demand balances to political events around the world, including government policies on taxation and export or import of natural resources. Oil is a commodity which price and price trends are sensitive to a wide range of factors including currency fluctuations, changes in interest rates, the general level of business activity and the prevailing rate of inflation, and in particular, international politics. As a result, oil prices and therefore bunker prices are subject to dramatic fluctuations. To the extent that any company is a seller or buyer of energy, this price volatility can have a negative impact on its net earnings. BNP Paribas is proposing various hedging techniques, from the simplest to the most creative, allowing its clients to optimise their risk management. Interest rate hedging The interest rate exposure is a main concern of shipping companies. Indeed, most of the liability weight generally consists of Senior debt with a defined margin over the LIBOR. BNP Paribas is proposing all typical interest hedging tools used by shipowner from the plain vanilla Cap, Swap, Floor to more complex options like knocking collar. BNP Paribas has recently developed a complex hedging tool named “maturity cap”. Forex hedging The shipping industry is mainly a dollar industry. Most revenues are in dollars, but some expenses are in other currencies (euro, yen…). As a global financial institution, BNP Paribas provides also a lot of structured hedging products for currencies. There are products that use the correlation between currencies and interest rates to optimise the hedges.

Cash management

Internet based solutions    Electronic banking, offering flexible and secure cash management facilities    Dedicated international payments service

Securitisation

France's leading shipowner, CMA-CGM (Compagnie Maritime d'Affrètement-Compagnie Générale Maritime), has successfully launched the first ever ship securitisation. The securitisation was rated by both Standard & Poor's and Moody's. BNP Paribas acted as sole arranger and bookrunner on this deal concerning the acquisition of 12 container ships representing a total investment of $800 million. A large number of investors and banks were approached in the leading financial markets of Europe, North America, and Asia, generating considerable interest in this deal, which was largely subscribed in each of its tranches.

Corporate Finance

The main focus has so far been on the IPO of companies in Asian stock exchanges such us China Shipping in Shangai and on M&A activities (confidential)

Equities & Derivatives

We offer tailor-made investment solutions designed to enhance Shipowner cash deposit returns. These solutions generally provide full capital garantee and very attractive target yield, compared to usual overnight deposit rates. We are usually working with corporate or holding entities within a Shipping Group which present stable cash over a period equal or greater that one year. Performance of our strategies can be indexed to various class of assets (equities, commodities, bonds, diversified funds or classic dynamic money market funds), according to the client request. For largest groups, we also offer transactions on Shipowner own shares (if listed), like share buy back program, or offer equity hedging/financing deals on their listed stakes.