Corporate Finance & Capital Markets
Corporate Liquidity Management
Summary
Liquidity management ensures cash is accessible when operating costs, debt service and unexpected expenditures fall due.
Why this matters in ship finance
Cash trapped in SPVs or pledged accounts may be unavailable even when consolidated cash appears ample.
The concept
Cash positions should distinguish unrestricted from restricted funds, committed facilities, debt-service reserve accounts and charterer receipts. Accounting presentation does not establish legal access.
How it is used in practice
Prepare rolling 13-week and 12-month cash forecasts; stress off-hire, charterer delay, refinancing and regulatory payments.
Practical issues
Group cash cannot automatically support each ship. Cash-pooling rights, covenants and cross-border restrictions require review.
How ShipFinance.ai uses this concept
Calculate accessible liquidity by legal entity, currency and time horizon.
Key takeaways
- Accessible liquidity matters more than consolidated cash alone.
- Stress delayed hire, dry-docking and refinancing needs.
- Distinguish restricted from unrestricted funds.