FRANKFURT Feb 6 Germany's DVB Bank
expects to recover two thirds of its loans to Islamic Republic
of Iran Shipping Lines (IRISL), Iran's biggest cargo carrier and
subject to Western and U.N. sanctions.
"Of four (Iranian) ships that DVB financed, three are now
back in Iran. DVB has arrested one ship called Uppercourt in
China," Chief Executive Wolfgang Driese told Reuters.
An arrest occurs when a ship is detained by a court order to
secure a maritime claim. The arrest may ultimately result in a
judicial sale of the ship to pay the claim.
"We expect to get back two thirds of our remaining exposure
to IRISL through the sale of this ship," Driese said.
DVB's exposure to IRISL currently totals less than 20
The Uppercourt, built in 2005, is a panamax dry bulk vessel,
which is typically used to transport commodities cargoes such as
grain and coal. A five-year old panamax vessel is currently
valued around $18.4 million, Baltic Exchange data showed.
Recently, a 2001 Japanese-built panamax vessel was sold for
around $12.5 million, with the Uppercourt estimated to be valued
around the $15.5 million level, a ship industry source said.
"The fact that the vessel is associated with Iran, for right
or wrong, will keep major players away from expressing interest;
not that the freight market and its prospects, or the shipping
finance availability kindle much interest these days, anyway,"
said Basil Karatzas, chief executive of consultancy and
brokerage Karatzas Marine Advisors & Co.
In January, Amina, another of the four ships, fled Sri
Lankan waters after weeks of detention by its navy, acting on a
court order obtained by DVB Bank. Sri Lanka's navy had fired
warning shots earlier to prevent the vessel from leaving.
"The Indian crew of the Amina has been treated badly. We are
searching for the crew members now and are planning to grant
them a small indemnity," Driese said.
Foreign companies have cut ties with Iran's shipping sector
for fear of losing lucrative U.S. business. A ban on EU ship
insurance provision and the exit of certifiers from Iran - vital
for access to ports - have added to woes for Iranian ship firms.
IRISL has tried to dodge sanctions by changing its flags and
setting up front companies, the U.S. Treasury and the EU have
said. Last year IRISL Managing Director Mohammad Hussein Dajmar
said that if pressure from Western sanctions continued, the
group would face increasingly grave financial problems.