I really don't think you should look at FRO as a customer. It is an artificial Ivy League financial construct. FRO + SFL is the tanker business. All the interdealings are artificial in nature.
In good times, nobody cares about the artificial nature. Good times were produced in 2 ways:
1. Tanker business was good.
2. The investing public had underpriced risk premiums and overvalued financial engineering. So the SFL spinout happened at inflated prices and FRO was allowed to be overly leveraged (thereby feeding the shareholder through divvys and SFL through cash flow that partly resulted from under reserving on the balance sheet).
Times are tougher now. We now will see if FRO will be allowed to be overleveraged by its bankers and creditors. If not, the SFL - FRO off balance sheet construct may implode and result in a single company (at least for the tanker operation).
If so, what is SFL worth? Psychologically, it takes a hit, but then what?
If it is to be valued as a bank or shipper, I can't see much upside from here. Still can be a 20-30% haircut in the short to intermediate term as earnings will drop and with the same multiple applied...