NordLB drops plans to sell shipping loans to KKR

German lender NordLB [NDLG.DE] has abandoned efforts to sell a 1.3 billion euro ($1.5 billion) portfolio of shipping loans to KKR (KKR.N), a spokesman for NordLB said on Monday.

NordLB had said in April it hoped to complete a deal by the end of June, following about a year of negotiations.

The failure to reach a deal is a blow to German banks trying to offload billions of euros in shipping loans as a sale of NordLB’s portfolio would have been seen as an indicator for interest in such types of debt.

Other banks, including fellow state owned HSH Nordbank, have also had limited success in selling shipping loans in recent months.

Earlier this year, financial sources told Reuters that KKR had already put the deal on the back burner, partly due to a lack of progress in talks over pricing for the assets.

NordLB also said on Monday that a sale of individual ship loans was more profitable than a sale of portfolios.

It added that even without the KKR deal it would meet its goal of reducing its shipping loan exposure to 12 to 14 billion euros by year-end, a year ahead of target.

KKR declined to comment.

NordLB remains in contact with KKR about potential cooperations, the public-sector bank said.