HSH Nordbank AG, the world’s largest financier of ships, recorded the worst full-year result since 2008 as the shipping crisis and additional tax payments prompted the bank to boost provisions.

The lender, which was bailed out by its state owners Hamburg and Schleswig-Holstein in 2009, saw its loss widen to 814 million euros ($1.1 billion) from 124 million euros in 2012, it said in a statement. In 2008, the year of the collapse of Lehman Brothers Holding Inc., HSH Nordbank posted a loss of 3 billion euros.

HSH Nordbank, like other financiers of ships, including Commerzbank AG (CBK) and Norddeutsche Landesbank Girozentrale, are suffering from rising credit default risks. The container industry, which accounts for the biggest share of ship loans among German lenders, has suffered from overcapacity since the global financial crisis triggered a trade slump and the worst decline in ship charter prices in decades.

HSH Nordbank cut its shipping portfolio to 21 billion euros from 23 billion euros in the fourth quarter, while increasing risk provisions in that segment to 3.3 billion euros from 2.7 billion euros, it said.

The bank set aside 127 million euros in provisions after it discovered that HSH traders from 2008 through 2011 executed questionable dividend arbitrage, or dividend stripping, with a “handful of foreign brokers,” the company announced in December. The trades generated tax credits on capital gains for deals that state-owned bank didn’t pay tax on, the bank said.

To cover potential losses at HSH Nordbank, Hamburg and Schleswig-Holstein raised a guarantee to 10 billion euros from 7 billion euros, which was approved by the European Union on a preliminary basis.

The bank said it now expects to draw as much as 1.6 billion euros from the guarantee from 2019 to 2025, compared with the 1.3 billion euros previously envisaged. The fees paid for using the facility will substantially exceed the planned draw-down on the guarantee, HSH Nordbank said.