J.P. Morgan Asset Management joins the shipping community urging shipowners to be in line with the upcoming environmental measures beginning in 2020 and extending to 2050, that aim to reduce shipping emissions, Wall Street Journal reports.
J.P. Morgan highlights that the environmental protection will be a key consideration for expanding shipping loans.
During the International Shipping Week, Andy Dacy, Chief Executive of J.P. Morgan, reported that everyone in the Western World are thinking about the impact of environmental, social and governance factors, adding that only those who will follow a sustainable path will be able to acquire a capital.
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Mr Dacy further stated that the loans and capitals will be provided to those who not only focus on the protection of the environment, but also to those who respect their crew, and are easy-to-collaborate with constituents in the industry to create a transparent organization.
In addition, Mr Dacy noted that the last ten years financing decision in the industry were taken by private-equity firms coming into shipping; Today, given that the private sectors look to exit the industry, institutional investors are looking beyond balance sheets to guarantees by shipowners that they will abide by the IMO climate regulations and timelines.
In summer, major banks, such as Citigroup Inc., France’s Société Générale SA and Norway’s DNB ASA, published the Poseidon Principles as a framework for assessing and disclosing the climate alignment of financial institutions’ shipping portfolios.
According to the Wall Street Journal, Chinese Banks, which hold about the 25% of all ship finance and more in the shipbuilding sector, are expected to publish their own climate criteria in their ship financing portfolios in the two following years.