Morgan Stanley is reportedly looking to sell its stake in an oil tanker operator.
Sources told the Financial Times that Morgan Stanley and shipowner George Economou are in advance talks to sell their stakes in Heidmar to New York-based FDX Capital.
The sources told the Financial Times that a deal could be announced “within weeks.”
Morgan acquired Connecticut-based Heidmar in 2006 and sold a 49 percent stake in the firm to Economou in 2008.
Neither Morgan Stanley, Economou nor Heidmar have commented on the matter.
Heidmar was as founded in 1984 and operates a fleet of about 100 vessels.
Morgan Stanley and its subsidiaries have sold several energy assets over the past several years, including two power plants and the bank’s global oil merchanting business.
The U.S. Federal Reserve has encouraged banks to shrink their positions in firms or assets that are tied to commodity sectors.
In September, the Federal Reserve Board (FRB) said it would invite public comment on a proposed rule that would strengthen existing requirements and limitations on the physical commodity activities of financial holding companies.
“The proposal would help reduce the catastrophic, legal, reputational, and financial risks that physical commodity activities pose to financial holding companies,” the FRB said in a statement.
As part of the proposed rule, the FRB said it would require firms to hold additional capital in connection with commodity activities if those commodities are already subject to liability laws in the case of a release or spill.
The possibility of an environmental accident due to these activities presents significant risks to the firms,” the FRB added.
According to data collected by the Financial Times, the value of Morgan Stanley’s commodities inventories has fallen from just over $10 billion in 2011 to less than $200 million as of the third quarter of 2016.
In 2015, Morgan Stanley sold its Global Oil Merchanting business to Castleton Commodities International for an undisclosed amount.
The merchanting unit was active in the light ends, distillates, crude and wet freight markets and traded about two million barrels of oil and oil products per day since 2010.