Financing for Infrastructure Appropriate Risk Sharing between Public and Private

Transcription

1 Financing for Infrastructure Appropriate Risk Sharing between Public and Private Structured Finance Division 5 March 2015 The Bank of Tokyo-Mitsubishi UFJ A member of MUFG, a global financial group

2 MUFG at a Glance Key Data MUFG Global Network Date of Establishment Number of Employees Aug.1919 Approx.120,000 MUFG Financials as of 30 September 2014 (consolidated) Total Asset JPY 264 trillion Loan Asset JPY 103 trillion Equity JPY 15 trillion Network as of 30 September 2014 Domestic Branches Over 1,100 Overseas Branches Over 1,100 Total Over 2,200 Latest Rating (BTMU) Moody s A1 S&P A+ Fitch A Saint-Petersburg Birmingham Amsterdam Moscow London Warsaw Vancouver Montreal Prague Paris Ulaanbaatar Shenyang Seattle Toronto Frankfurt Minnesota Madrid Vienna Almaty Tianjin Binhai Vladivostok Boston New York Milan Istanbul Beijing Lisbon Dalian San Francisco Chicago Washington Barcelona Tehran Tianjin Seoul Chengdu Los Angeles Kentucky Atlanta Neemrana Cairo Shanghai Dallas Karachi New Delhi Wuxi Houston Bahrain Guangzhou Shenzhen Dubai Doha Dhaka Kowloon Taipei Mexico City Abu Dhabi Mumbai Yangon Hong Kong Cayman Hanoi Manila Chennai Bangalore Penang Ho Chi Minh Caracas Kuala Lumpur Labuan Bogota Singapore Jakarta Surabaya Bandung Lima Rio de Janeiro! BTMU acquired the Bank of Ayudhya Public Company Limited (BAY) in Thailand. Johannesburg Perth Melbourne Sydney Auckland Santiago Sao Paulo Buenos Aires! BTMU Bangkok Branch was integrated into BAY in January The Bank of Tokyo-Mitsubishi UFJ Mitsubishi UFJ Securities Holdings Co., Ltd. Mitsubishi UFJ Trust and Banking Corporation 1

3 BTMU in India! More than Half of century in India BTMU in India " Since 1953 after Mumbai branch (Former Bombay blanch) was established, BTMU committed to offer high quality service and operation to our valued clients for over 60 years.! Wide Network India with 5 branches/offices Branch Established in 1953, GM Branch Business Area: ( ) Ahmedabad ( ) etc. New Delhi Neemrana New Delhi Branch Established in 1963 Business Area Delhi Gurgaon Area ( ) Noida (Uttar Pradesh) ( ) etc. " On April 2, 2014, The Bangalore branch (With the full-banking license) commenced its operation as the fifth office of BTMU in India. Ahmedabad Pune Mumbai Hyderabad Kolkata Neemrana Branch Established in 2012 Business Area: Bawal Area ( ) Bangalore Chennai Branch Established in 2014 Business Area: ( ) ( ) etc. Branch Established in 1966 Business Area: ( ) ( / ) etc. 2

4 Financing to Urban Infrastructure Development Financing to Urban Infrastructure Development Civil Works Finance Menu Master Plan, Civil Works, Real Estate Development. Budget Allocation ODA Basic Infrastructure Transportation, Power, Waste Management, Water etc. ECA Finance (JBIC/NEXI etc.) Corporate Finance Project Finance Life & Smart Infrastructure Life & Culture Related Facilities, Renewable Energy. Infrastructure Funds Capital Market 3

5 Major Risk Allocation between Public and Private Sectors Key Considerations for Financiers in Infrastructure and PPP Projects Involving Public Sector Key Project Risks Preparation! Land Acquisition! Permit and license Potential Mitigations for lenders! Complete land acquisition process and required regulatory process (i.e. License, Permit, Approval of authority etc.) Preferred Allocation Public Construction Operation Construction! Cost overrun, late delivery of the project! Fixed price and date certain contract structure with adequate performance guarantees, liquidated damages and warranties Demand! Risk that overall demand for service is lower than initially forecasted Offtaker! Risk that offtaker is unable to meet payments under the contract due to poor creditworthiness! Lack of Government support! Need for government to take demand risk, or provide support or allow unitary payment structure! Need for government to support offtaker s obligations! Clear budget allocation and support process Private Public Public Operation and Maintenance! Failure to meet quality standard or continuity of service provision! Incentives / penalties mechanism to be applied to encourage the service provider to improve service delivery or remedy the failure promptly! Sufficient market depth for replacement of non-performing contractor Private 4

6 Key Take-Away Key Take-Away Strong Government Support for Project Risk! Prioritize the infrastructure development in each sector! Provide strong government (financial and political) support by taking major project risk in order for international investors to understand the country and the sector! Establish good track record in each sector Facilitate Long-term Local Currency Funding Market! Infrastructure assets require long term local currency funding due to revenue being denominated in local currency! Development of local currency funding market helps private sector access stable funding sources Clear Policy and Procedure! Need for clarity and consistency in policies, legislations, procedures, decision making, government support/ responsibility relating to infrastructure investments! Transparency in bidding process with comprehensive development plans! Need to develop and facilitate legal and regulatory framework 5

7 Appendix. Introduction of MUFG Contact List

8 Appendix. Introduction of MUFG Contact List Global Structured Finance Organization Chart Tokyo Global Head New York Investment Banking Division for the Americas Commodities & Structured Trade Finance Dept Structured Finance, Project & Real Estate Dept BTMU Leasing & Finance Inc London European Investment Banking Division Commodity & Structured Trade Finance Dept Acquisition Finance, Securitization Dept European Structured Finance Office Singapore, Hong Kong Asia Investment Banking Division Tokyo Structured Finance Division ECA, Commodities &Trade Finance Dept Project Finance Dept Solution Finance Dept Special Finance Dept Fund Investment Office M&A Finance Office Real Estate Finance Office Social & Environmental Risk Assessment Office Asian Origination Team Energy, Commodities & Trade Finance Dept Growth Strategy and Infrastructure Origination Team Global Finance, Project, LBO, Special Finance Dept Australian Structured Finance Office 7

9 Appendix. Introduction of MUFG Contact List Asian Origination Team Our Mission and Activities Our Mission! Asian Origination Team (AOT) follows the important infrastructure opportunities in Asia from the very early stage.! AOT provides long term support with the client working together with BTMU s dedicated product offices such as project finance, ECA and trade finance. Target Sectors Activities and Services! Railway, Road, Airport, Port, Water, Power etc.! AOT supports clients by providing finance-related information and, if necessary, initial financial proposal from the early stage.! For projects that require further support and financial advises at the execution stage, AOT introduces our specialists from the product offices such as ECA, Commodities & Trade Finance Dept and Project Finance Dept.! Under the framework of Global Infrastructure Advisory Board, we encourage cross-regional marketing (joint pitch, international conference etc) by leveraging BTMU s global expertise and network in infrastructure sector.! Project stage and the involvement of BTMU Early Discussion Feasibility Study FA Stage MLA Stage Financial Close Asian Origination Team Product Offices (Project Finance, ECA etc) 8

10 Appendix. Introduction of MUFG Contact List BTMU ECA Finance Team Global Coverage BTMU has worked with more than 30 ECAs and Multilateral Agencies. EIBD (London) European ECAs! ECGD (UK)! COFACE (France) IBDA (New York)! Hermes (Germany)! SACE (Italy) SFD (Tokyo)! CESCE (Spain)! EKF (Denmark)! Finnvera (Finland) North American ECA and Multilateral Agencies! GIEK (Norway)! US-EXIM (USA)! EDC (Canada)! EKN (Sweden)! MIGA! SERV (Switzerland)! IFC! EGAP (Czech Rep.)! IDB! KUKE (Poland)! Atradius (Netherlands)! ODL (Luxemburg)! ONDD (Belgium)! OeKB (Austria) BTMU Brazil (Sao Paulo) AIBD (Singapore, HK, Shanghai) Asian/Oceanian ECA and International Multilateral Agencies! JBIC (Japan)! NEXI (Japan)! KEXIM (Korea)! K-Sure (Korea)! China-EXIM (China)! Sinosure (China)! EFIC (Australia)! ADB (Philippine) 9

11 Appendix. Introduction of MUFG Contact List BTMU s Presence in the Global ECA Market Global ECA League Table (in USD million) MLA Amount Share Deal MLA Amount Share Deal MLA Amount Share Deal 1 HSBC 4, % 48 BTMU 7, % 47 BTMU 5, % 41 2 BTMU 3, % 36 HSBC 5, % 62 HSBC 4, % 48 3 SMBC 3, % 38 Mizuho 4, % 44 Mizuho 4, % 26 4 BNP Paribas 3, % 47 SMBC 4, % 41 JPMorgan 3, % 11 5 JBIC 2, % 10 Citi 3, % 24 SMBC 3, % 30 6 SG CIB 2, % 33 Deutsche Bank 3, % 28 Citi 2, % 18 7 Ex-Im Bank 2, % 2 Santander 3, % 21 SG CIB 2, % 25 8 Citi 2, % 21 BNP Paribas 2, % 33 BNP Paribas 1, % 30 9 Mizuho 2, % 24 ING 2, % 18 ING 1, % Bank of China 2, % 9 SG CIB 2,153, 2.3% 18 Santander 1, % 22 Total 62,459 94,409 57,443 (Source) Dealogic 10

12 Appendix. Introduction of MUFG Contact List BTMU s Global Presence in Project Finance Consistently Positioned as a Top PF Bank! BTMU is a major Project Finance houses on a global basis.! BTMU was Awarded Global Bank of the Year 2013 and 2011 by PFI.! BTMU was ranked 1st globally and in Americas in 2013 full year league table by PFI.! BTMU is consistently positioned as a top global project finance bank: " Sole bank consistently ranked within top 10 over the last 12 years globally. " Sole Japanese bank ranked within top 10 over the last 12 years globally. Mandated Lead Arranger Ranking Full Year 2014 Rank Arranger Amount in USD million Share No. of Deals 1 MUFG 16, % SMBC 13, % Mizuho 9, % 80 4 BNP Paribas 9, % 73 5 Credit Agricole 8, % 80 6 ING 7, % 77 7 CBA 7, % 53 8 HSBC 6, % 48 9 Societe Generale 6, % SBI Capital 5, % 25 (USD (m)) 18,000 15,000 12,000 9,000 6,000 3, ,227 Mitsubishi UFJ ,451 SMBC 112 9,848 9,003 8, Mizuho Financial (Source) Project Finance International (2014) BNP Paribas Credit Agricole Amount in USD (m) 7,555 7,277 6, , ING CBA HSBC Societe Generale No of deals 5, SBI Capital

13 Appendix. Introduction of MUFG Contact List Contact List Asian Origination Team Masayuki Fujiki Head of Asian Origination Team Tomonori Miyagawa Senior Manager Hideto Shimonishi Manager Tomohiro Komuro Manager Chika Fukuyama Manager Mizuho Nishi Associate Takahiro Inoue Associate

14 Disclaimer The information herein is provided for information purposes only, and is not to be used or considered as an offer or the solicitation of an offer to sell or to buy or subscribe for securities or other financial instruments. Neither this nor any other communication prepared by The Bank of Tokyo-Mitsubishi UFJ, Ltd. (collectively with its various offices and affiliates, BTMU ) is or should be construed as investment advice, a recommendation to enter into a particular transaction or pursue a particular strategy, or any statement as to the likelihood that a particular transaction or strategy will be effective in light of your business objectives or operations. Before entering into any particular transaction, you are advised to obtain such independent financial, legal, accounting and other advice as may be appropriate under the circumstances. In any event, any decision to enter into a transaction will be yours alone, not based on information prepared or provided by BTMU. BTMU hereby disclaims any responsibility to you concerning the characterization or identification of terms, conditions, and legal or accounting or other issues or risks that may arise in connection with any particular transaction or business strategy. Note that BTMU may have issued, and may in the future issue, other reports that are inconsistent with or that reach conclusions different from the information set forth herein. Such other reports, if any, reflect the different assumptions, views and/or analytical methods of the analysts who prepared them, and BTMU is under no obligation to ensure that such other reports are brought to your attention. UFJ UFJ UFJ UFJ UFJ UFJ Copyright 2015 The Bank of Tokyo-Mitsubishi UFJ, Ltd. All rights reserved UFJ 13