What is the principal security package used in a ship finance transaction?
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Hi Despina 
A typical ship finance transaction is a senior secured loan with a fairly predictable collateral (security) package which usually contains:
- ship mortgages (based on the law of the Flag state)
- general assignments (eg. assignment of vessels’ earnings, insurances)
- letter of undertaking or manager’s undertaking
- account security (based on the law of the location of the relevant account)
- shares security (based on the jurisdiction of the company whose shares are subject to the security)
- subordination agreements/ subordinated debt security (if any)
- pre-delivery security (for newbuilding financings)
- tripartite assignment
- quiet enjoyment letter (for ships on long-term time charter)
- direct arrangements
Of course, every ship finance transaction is different and above described security package can vary on a case-by-case basis.
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Thank you Pauline! 
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