ASIAN DEVELOPMENT BANK Private Sector Operations Department. Business Opportunity Fair - Vienna November 2018

Transcription

1 ASIAN DEVELOPMENT BANK Private Sector Operations Department Business Opportunity Fair - Vienna November 2018

2 Differences between Sovereign and Non-Sovereign Operations

3 Resources, Portfolios, and Programs Sovereign ~1,650 Staff Non-Sovereign ~190 Staff (June 30, 2018) Sovereign ~$97 billion Non-Sovereign ~$8 billion (June 30, 2018) Sovereign ~$24 billion Non-Sovereign ~$8 billion (December 31, 2017) 3

4 Project Cycle Key Differences with Non-Sovereign Project proposals are post-feasibility study, therefore ADB is not involved in the detailed design of projects (5) Evaluation (4) Implementation (3) Approval and Effectiveness (1) Identification (2) Preparation Therefore, we are not involved in the selection of the sponsors EPC contractors or advisors (technical, legal, etc.) Sponsors approach ADB for financing and/or investment, plus validation of commercial, safeguards, and other matters Sovereign Project Cycle ADB supervises projects until the loan is repaid or the investment is sold 4

5 Pricing Sovereign ADF Grants Concessional OCR Regular OCR Fixed tenor and pricing depending on country classification Contractual spread plus maturity premium Non-Sovereign = Market Pricing for Pricing Tool Market Comparators Co-Financiers Co-Investors Private Sector Projects Expected Loss Admin Expenses Capital Cost Relevant recent transactions Pricing and valuation of potential partners 5

6 Non-Sovereign Operations

7 Aligning Operations with S2030, SDGs, and Megatrends Life Expectancy Falling Fertility Ageing and Growing Population Competition for Land, Water, Food and Energy Alternative Energy Sustainable and Inclusive Growth Master Planning AI, IoT, Robotics and Automation 7

8 Priorities Sectors, Themes, and Products Infrastructure Loan Financial Institutions and Private Equity Funds Agribusiness Equity Mobilization and Credit Enhancement Products Social Sectors Local Currencies Climate Change Short-term Financing Inclusive Business and Gender Corporate Governance and Integrity Business Development Recent Focus/Strengthened Areas 8

9 2,015 2,016 2,626 2,502 2,287 2,242 2,890 3,150 4,589 5,834 5,947 5,972 Operations PROGRAM RESULTS YTD ($MM) Approvals Commitments Co-Financing Non-sovereign operations are expected to reach 1/3 of total ADB operations in number by 2024 Substantially increase long-term cofinancing to 250% of own account financing by 2030 Support climate change mitigation and adaptation projects in private sector projects Contribute to the promotion of gender equality in private sector projects Successfully filled 68 staff positions during 2017, and have filled 46 staff positions year to date (Oct-end 2018) YTD 9

10 Co-financing and Asset Management Co-financing by Type Funds under Management Leading Asia s Private Infrastructure Fund $1.5 billion Debt and Equity Canadian Climate Fund for the Private Sector in Asia $82 million / $150 million Asia Climate Partners $450 million ADB & Orix as co-gps Climate Investment Funds $350 million Concessional Finance 10

11 Portfolio by Sector and Product Committed Exposure of $12 Billion as of September 30, 2018 (Inner Circle by Project Count, Outer Circle by Volume) 11

12 Portfolio by Region and Country Committed Exposure of $12 Billion as of September 30, 2018 (Inner Circle by Project Count, Outer Circle by Volume) 12

13 Commitments YTD Central and West Asia Armenia n Spayka n Electric Networks of Armenia n Ameriabank n FINCA Bank Azerbaijan n Shah Deniz Georgia n FINCA Bank n TBC Bank Pakistan n Triconboston Wind Power n Khushhali Bank MSME n Agribusiness n Energy Renewable n Energy Other n Financial Institutions n Health n Info, Com and Telecom n Private Equity n Transport n Water n Urban South Asia Bangladesh n BRAC Bank n Eastern Bank India nn India Agri Business Fund II n Power Grid n Mytrah Wind and Solar Power n Ostro Kutch Wind Power n ReNew Solar and Wind Power n Au Financiers n PNB Housing Finance n Janalakshmi Financial Services n IndusInd Bank n Satin Creditcare Network n Cholamandalam MSME n True North Fund VI Sri Lanka n Walkers Colombo Shipyard n DFCC Bank MSME South East Asia Cambodia n Sunseap Solar Power Indonesia n Equis I/II n Muara Laboh Geothermal Power n Rantau Dedap Geothermal Power n Tangguh LNG Expansion n Jawa -1 LNG to Power n Hermina Myanmar n Myingyan Natural Gas Power Plant n Irrawaddy Towers Philippines n Tiwi and MakBan Geothermal Power Green Bonds Thailand n Chana Green WTE n Gemstone n Chonburi Natural Gas Power Vietnam n China Everbright International WTE East Asia People s Republic of China n Jiangsu Lihua Animal Husbandry n Kingenta Ecological Engineering n Inner Mongolia Saikexing Breeding n China Everbright Renewable Energy n Arctic Green Geothermal Power n CFPA Microfinance n MicroCred nn Minsheng Financial Leasing n State Grid International Leasing n China Water Affairs n CWEG n CT Environment n Beijing Capital Pacific Samoa n Jarcon Pty and Sun Pacific Energy Regional n Agripacific n Olam nn B Grimm Power I/II n Fluidic n CreditAccess Asia n Micro-Credit Ratings International n Creador III L.P. Fund n VI (Vietnam Investment) Fund III n Exacta Asia Investment II nn OrbiMed Asia Partners III n DCDC Health Services 13

14 Eligible Transactions Located in ADB s developing member countries ADB s target sectors (infrastructure, financial sector, agribusiness, etc.) and themes (climate change, inclusive business, etc.) High demonstrational value and replicability Innovative (new technologies or ways of doing business) Highest integrity and ethical standards Crowding in commercial financing Developmentally and commercially sound, with a clear business plan Financing not directly guaranteed by the government Clear financing or other need (safeguard support, risk coverage, etc.) from ADB Willing to employ professional advisors (legal, technical, environment and social, etc.) For equity investments, a board seat for ADB and clear exit strategy ADB Additionalities Financial, including (i) various products from debt to equity, credit enhancement and risk mitigation, (ii) local currencies, and (iii) longer tenors and patient investor Non-financial, including (i) stamp of approval, (ii) country risk mitigation, neutral broker role with governments, (iii) safeguard and corporate governance expertise, and (iv) extensive knowledge of markets, sectors, and clients 14

15 Modalities Instrument Typical Size Typical terms Debt $20M - $500M 7 years (corporate) to 15+ years (project) LIBOR / ADB cost of fund in local currency + credit spread Secured or unsecured When is it relevant? Established company with large balance sheet, strong cash flow Possibility to mobilize co-financing under B-loan or risk participation Equity $2M - $100M Guarantees $20M - $500M 25% ownership maximum Board seat Minority protection rights Put on the parent company Partial credit guarantees (PCG): market based, fees based off lenders margin Political risk guarantees (PRG): market based, fees based off reinsurance market Growing company in a pre-ipo or pre-trade sale situation Where other lenders are more efficient than ADB in mobilizing local currency, or reaching target customers (PCG) In frontier markets (PRG) Donor Funding $5M - $10M Long term loan at concessional interest rate to be blended with ADB financing First loss cover Whenever donor funds managed by ADB are available Applicable for climate mitigation and adaptation projects or low-income countries Technical Assistance $0.5M - $1M For project preparation TA, reimbursable at closing For capacity development TA, nonreimbursable grant For projects in need of additional, concessional financial assistance 15