Royal Bank of Scotland flogs £235m of investment grade shipping loans to Japanese bank

 
Oliver Gill
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The Queen Mary II, reputedly the world's
RBS had hoped to sell considerably more of its portfolio of shipping loans (Source: Getty)

Royal Bank of Scotland (RBS) has sold £235m of Greek shipping loans to Japanese firm Orix in an attempt to bolster the coffers of the majority state-owned bank.

The sale is considerably smaller than the original $3bn deal to sell the whole of RBS' Greek shipping business to Orix, and a narrower portfolio compared with $600m of debt previously believed to be on the table.

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Sources close to the deal told Reuters most of the loans Orix is snaffling up are investment grade – typically rated BBB or above by credit agencies.

The bank – 70 per cent owner by the UK government – is fighting fires on several levels.

Read more: Five problems facing RBS chief exec Ross McEwan

RBS declined to comment on the news that would come as a boost to the ailing lender.

In its latest results it revealed a £469m loss, revealed it won't be able to sell its Williams & Glyn subsidiary – a condition of its 2008 bail-out in 2008 – and is staring down the barrel of a mega-fine from US authorities over mis-selling of mortgage-backed securities.

The shipping sector has hardly fared better than RBS over recent years and as the market is squeezed, European banks have sought to reduce their exposure, in particular as banking rules require greater allocation of capital to poorer performing loans.

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