Editor’s choice Awards West Marine Money (Marine Money June 2011)

Editor’s choice Awards West Marine Money (Marine Money June 2011)

DVB’s “Unsung” Hero

Buried in the bowels of DVB’s operations is the Research and Strategic Planning Department, known internally as RASP. As the only commercial bank with its own research department, DVB’s management has interwoven this team into the corporate DNA ensuring that little happens in the organization, which RASP does not touch upon.

An organization is built from its people and here some interesting choices were made. RASP is not, as one might expect, staffed by academics, although no one would question their intelligence, but instead is populated by employees who are grounded in shipping. In addition to backgrounds in economics and finance, the eight employees have practical experience in commercial management, sale& purchase, chartering and technical management. Moreover the department has its own technical committee, consisting of two master mariners and two chief engineers. In fact, it resembles its own in-house shipping company. Did someone say spin-off?

When you mention research, the word that immediately comes to mind is information and this is RASP’s raison d’etre. Its focus is on the discovery, creation, and dissemination of knowledge on assets financed, markets/sectors and trade flows in the 20 sectors and 66 sub-sectors it follows. Knowledge, in and of itself, is useless if access is limited and so RASP developed an innovative intranet platform to distribute information to all of its 13 locations worldwide.

The department’s pride and joy is code-named “Delphi.” Like the oracle it is named for, it is a unique forecasting model which provides the ability to quantify the department’s market outlook. Developed in-house, the model is different from its commercial competitors, which are based upon mathematical models largely focused on supply and demand. Delphi on the other hand focuses on micro and macro variables. In developing the model, the company tested 500 variables with data going back to 1985 and found 200-300 which met their standard of a 95%-98% correlation. The variables used, naturally, differ for each of the main sectors it covers – bulkers, tankers and containers.

Woven into the loan life cycle, RASP provides essential market, sector and asset research and technical expertise at each credit inflection point in the loan cycle. These technical checks at each credit decision point and throughout the tenor of the loan insure that the underlying assets’ tradability, earning power and values are protected. The department also plays a key role at the macro level through the development of the strategic plan, as well as providing Mr. Lunde with the material for his always excellent presentations.

In either case, it deserves the recognition of this award.

By George Weltman