RBS offers freight derivatives

Royal Bank of Scotland (RBS) has started offering shipping derivatives, in the form of forward freight agreements (FFAs) linked to the transport costs of bulk commodities to its client base.

RBS already offers its ship-owning clients interest rate and foreign exchange hedging, and said there was a growing demand for FFAs from clients who wish to hedge their freight income.

Richard Bowler, deputy head of shipping products, and Andy Hartree, head of commodities, will jointly run the service from the bank’s London office.

The International Maritime Exchange (Imarex), an Oslo-based shipping derivatives exchange, estimates the volume of freight derivatives transactions could hit $19

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