Chinese banks should enhance their professionalism and services to global standards if they want to tap the opportunity to finance shipping companies which find it hard to get financing from European banks due to the debt crisis.
Many European banks have reduced their loans and credit to the shipping companies which caused them to turn to the Chinese banks in a bid to secure financing, industry experts said at a marine forum in Shanghai yesterday.
The opportunities are there for the Chinese banks to expand into shipping finance, they said. In 2009, the Industrial and Commercial Bank of China and the Bank of China provided shipping finance of US$16.9 billion, or 5 percent of the global share, Marine Money data showed.
"Chinese banks are going to take a very important share in global shipping finance in the next 10 years," said Paul Chang, managing director and global head of shipping at ICBC Financial Leasing Co.
But Chinese banks still have a way to go to meet international standards required in shipping finance.
George Xiradakis, managing director of XRTC, a consulting company for Greek shipowners, said China Development Bank took 17 months, much longer than the international practice of one-two months, to provide financing to Greek shippers. It took a long time to process because there was a lack of shipping finance experts in the bank, he said, adding that Chinese banks should hire more foreign shipping experts and deepen their global shipping network.
Qiu Jun, vice senior manager of the shipping finance department at the Bank of Communications, agreed that Chinese banks lack adequate professional staff, risk assessment and an understanding of the shipping business.
"The level of knowledge of Chinese banks in the industry is lacking compared with their Western counterparts," Chang said.