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The motives for shipping asset securitisation: sale-leaseback transactions in the shipping industry

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  • Sangho Yoon
  • Chi Yeol Kim
  • Young-Joon Seo

Abstract

This study investigates shipping firms’ motives for using sale-leaseback (SLBs) transactions. Given the bleak conditions in the shipping industry that have persisted since its collapse in 2008, numerous firms have sought ways to relieve short-term financial distress and secure long-term sustainable growth. This study analyses financial ratios of 123 shipping companies in Korea, 25 of which elected to use SLBs in 2019, in terms of growth, profitability, liquidity and leverage for the period of 2016–2018. Consistent with previous findings, the results show that applying for SLBs is associated with a lack of liquidity. By exploring SLBs as a new financing vehicle for shipping companies, the vast majority of which have been under financial distress and constraints in recent years, this study enriches the existing literature on shipping finance. Besides, this study’s findings on shipping companies’ motives for using SLBs can provide helpful suggestions for designing and implementing government policies for restructuring national shipping industry.

Suggested Citation

  • Sangho Yoon & Chi Yeol Kim & Young-Joon Seo, 2023. "The motives for shipping asset securitisation: sale-leaseback transactions in the shipping industry," Maritime Policy & Management, Taylor & Francis Journals, vol. 50(3), pages 287-300, April.
    • Handle: RePEc:taf:marpmg:v:50:y:2023:i:3:p:287-300
    DOI: 10.1080/03088839.2021.1983218
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