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Main / Project financing


Project financing

Project Finance is the financing of investment projects, it is one of the main directions of our business , in which the source of debt service to cash flow generated by the project. The specificity of this type of investment is that the assessment of costs and revenues is based on the allocation of risk between the project participants.

Project Finance is a method of raising long-term debt financing for major projects through "Financial engineering" that is based on the loan against the cash flows generated only by the project itself, and is a complex organizational and financial activities Finance and control of project participants.

Advantages

  • * Lending to the different purposes of the business or an equity participation in the business;
  • * Favorable interest rates;
  • * According to the customer selection of the type of interest rate (fixed/floating);
  • * Simplified the process of obtaining a loan;
  • * Reduced paperwork;
  • * Short terms of consideration of applications for funding (1-3 days);
  • * Long-term lending institutions;
  • * Individual approach to each client;
  • * Flexible collateral requirements for the loan.

In the project, which is considered to be realized in terms of project financing, involving at least three participants:

  • * The project company. It is created specifically for the project, is responsible for its implementation and usually has no financial history, no assets for collateral. It is the use of the project company is the main distinctive feature of this type of projects;
  • * The investor who invests in the equity of the project company. The investor, on the one hand, is rarely limited to cash deposits and profits, on the other hand, especially when several investors, their investments may not be in the financial infusions. Such investors initiate a project, create project company and in one form or another expect to benefit from its success;
  • * The lender. Apart from the fact that the project company receiving the loan has no collateral or guarantors in the traditional sense of those terms, the share of borrowed capital in project financing is significantly higher than in normal corporate loans and the average amount provided by the lender, constitutes 80-90% of all capital costs of the project.