Korea Ocean Business Corp. releases 2025 ship finance report; total issuance reaches $7.89 billion; foreign institutions hold 66% share of domestic market

Trends in ship finance activity by financial institution type [Korea Ocean Business Corp.]
Trends in ship finance activity by financial institution type [Korea Ocean Business Corp.]

New ship financing in South Korea's shipping market shrank last year even as the total outstanding balance of ship loans edged higher, according to a report released by the Korea Ocean Business Corp. Foreign financial institutions continued to dominate the domestic ship finance market.

The Korea Ocean Business Corp., known by its Korean acronym KOBC, released its "2025 Ship Finance Report" on Wednesday, analyzing the funding activities and vessel investment trends of 100 major South Korean shipping companies. The report, the second of its kind, was published three months earlier than last year's edition.

According to the report, the volume of new funds raised last year for vessel acquisitions and investment fell from the prior year. The 100 shipping companies financed a combined fleet of 1,041 vessels, with total new ship finance issuance reaching approximately $7.89 billion — down 11.2 percent from the previous year. The total outstanding balance of ship finance loans rose 12.1 percent year-on-year to roughly $27.3 billion, reflecting the accumulation of previously raised funds yet to be repaid.

By institution type, foreign financial institutions held the largest share of the domestic ship finance market at 66 percent, up 3 percentage points from the prior year. The share held by private-sector lenders, which had been declining since 2022, reversed course last year and climbed to 7 percent.

Policy finance, by contrast, fell to its lowest share since 2022 at 27 percent. KOBC attributed the decline to its sustained guarantee support between shipping companies and private lenders, which it said helped create a stable financing environment that drew private capital into the shipping industry.

The market last year also tilted toward secondhand vessels over newly built ships. By vessel count, 74 percent of ship finance activity was concentrated in secondhand vessel investment. Bulk carriers accounted for the largest share by vessel type at 36 percent, followed by tankers at 31 percent. New fundraising and refinancing — the restructuring of existing loans — were split roughly 60-40.

"The analysis of ship finance was made possible through the active cooperation of South Korean shipping companies," KOBC President Ahn Byung-gil said. "We hope these ship finance statistics will provide practical guidance for government policy, industry strategy and private investment."


alsgp9737@heraldcorp.com