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If you think the liner shipping companies are in a parlous state, you should try sitting in their bankers’ offices. Commerzbank’s stated intention to reduce its shipping portfolio by 40% is making little headway, which is no little matter given that currently the non-performing part of that portfolio amounts to a massive €4.5bn. While everyone is looking for demand levels to equalise overcapacity, this author argues that a genuine recovery in shipping will never happen until a thorough reform of ship finance practices has taken place.

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