European Central Bank Hones In on Shipping Loans

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ReutersBy Andreas Kröner

FRANKFURT, June 21 (Reuters) – The European Central Bank is taking a hard look at lenders’ ship financing portfolios amid a broad deterioration in the shipping market, keeping banks on edge about the potential need for more capital and higher loss provisions, five people familiar with the situation said.

The ECB’s banking supervisor sent an email at the end of last week asking a raft of European banks for details of their shipping loans and the status of their loan loss provisions as an “initial step” in a broader review of lending in the sector, one of the sources quoted the email as saying.

“It is a very extensive request,” the source told Reuters.

The ECB declined comment. (Additional reporting by Frank Siebelt in Frankfurt and Jonathan Saul in London, Writing by Jonathan Gould; Editing by Edward Taylor)

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