Germany’s private bank Berenberg has added two new closed-end multi-investor shipping funds to its portfolio.
As informed, the funds are targeting institutional investors. They have been launched by Germany’s oldest private bank alongside with Universal-Investment-Luxembourg as an alternative investment fund manager (AIFM).
In total, the AIFM now administers 13 funds of this type with a volume of around EUR 3 billion ($3.5 billion) for Berenberg.
Specifically, both funds enable investors to make broadly diversified investments in senior secured corporate or ship mortgage loans starting at mid-single-digit million amounts and are intended to continue the successful history of the already existing funds.
“The new funds complement a series of debt funds that have been launched exclusively for large institutional investors such as insurance companies and pension funds since 2016. Through the funds, we provided direct loans in the segments of transaction financings, ship mortgage loans as well as financings for renewable energy and infrastructure projects,” Lars Hagemann , Head of Structured Finance at Berenberg, said.
“Profitable long-term financings are no longer provided by banks exclusively, but also by debt funds.”
“Alternative investments such as debt funds are on a strong growth path. More and more investors – even with smaller volumes – are interested in the area of debt financing,” Sofia Harrschar , Head of Alternative Investments and designated Country Head of Universal-Investment in Luxembourg, commented.
By exploiting financing niches, investors can achieve an attractive return with a conservative risk profile at the same time.
“ This approach has proven its worth even in a challenging market environment such as 2020 in the light of the Covid19 pandemic. All Berenberg debt funds were able to continue their track record without any losses,” Hagemann added.
In the segment of secured ship mortgage loans, the Hamburg-based private bank pursues “an extremely conservative approach” with senior secured mortgage loans for the major commercial shipping segments with a maximum loan-to-value of 60 per cent – on average significantly below – and loan tenors in the lower maturity band.
“Our long-standing international market presence enables constant access to attractive projects… Ship loans have a particularly attractive risk-return-profile due to their first-ranking collateralisation through fungible assets and offer conservative investors an ideal entry into the long-neglected trend topic of maritime trade – which is and remains the backbone of the global economy,” Philipp Wünschmann , Head of Shipping at Berenberg, noted.
The funds are available for institutional investors of Berenberg as of now.
Berenberg provides support for international shipping clients and investors in the sector and is active in ship finance and treasury services for shipping.