The shipping finance sector is experiencing a resurgence, with global bank lending to shipping climbing back above $300 billion in 2025, according to the latest Petrofin Global Bank Research report. This marks a significant recovery after years of consolidation, with the Petrofin Global Index of Ship Finance returning to levels last seen in 2018. The report highlights a shift in the industry, with a focus on the broader implications of this recovery and the factors driving it.
One of the key drivers of this recovery is the return of Greek banks, which grew their shipping loan books by 37% year-on-year to $23.6 billion, up from $18 billion in 2024. Scandinavian banks also recovered strongly, increasing lending by 16.2% to $26.2 billion after an 8% decline the previous year. The report notes that there were no bank departures from the sector in 2025, with the vast majority of banks remaining positive towards shipping.
The recovery is also being supported by strong cash flows, rising vessel values, and a larger orderbook. The Clarkson's Price Index rose from 176 in 2024 to 191 at the end of 2025, while the total value of the fleet and orderbook rose from $2.03 trillion in December 2024 to $2.166 trillion at the end of 2025 and then to $2.381 trillion by May 2026. This indicates that the industry is not overleveraged, despite the Clarkson's-estimated fleet and orderbook value of $2.17 trillion at the end of 2025.
However, the report also highlights the impact of geopolitics on the industry. Threatened US penalties on Chinese owners, Chinese-linked vessels, and vessels entering the US prompted some owners, especially listed companies, to reduce their exposure to Chinese leasing structures and convert leases into bank loans. This shift benefited major international banks like Citi and ING, although Chinese leasing resumed once the threat of penalties subsided.
Borrowing conditions have also improved, with competition pushing loan margins lower. Mid-sized owners are able to secure margins of around 1.5% to 1.9% when backed by strong parent guarantees and liquidity. Arrangement fees have fallen to well below 1%, while loan-to-value ratios remain around 60%. Sustainability-linked finance is also growing, with Poseidon Principles banks focused on bilateral lending holding portfolios of more than $200 billion.
Despite the positive outlook, the report notes that the shipping finance sector is no longer the narrow bank-dominated market it was before the financial crisis. Banks are growing again, but leasing, export credit, regional lenders, funds, and private capital are all taking a larger role. The available financing options for owners have multiplied over the past decade and are expected to continue expanding.
In conclusion, the shipping finance sector is experiencing a resurgence, driven by a combination of strong cash flows, rising vessel values, and a larger orderbook. However, the industry is still exposed to sanctions, geopolitics, energy shocks, and high vessel values that need to be supported by real earnings. The broader message is that shipping finance is moving from a specialist niche towards a broader global asset class, with a focus on the broader implications of this recovery and the factors driving it.
