Project Finance
Long-term funding for major projects, relying on future cash flows for repayment.
Detailed Description
Project Finance
What is the main principle behind project finance?
Project finance is based on funding large-scale projects using the projected cash flows of the project rather than the sponsors' balance sheets.
What are the key features of project finance?
Key features include non-recourse or limited recourse financing, complex contractual structures, detailed risk assessments, and involvement of multiple stakeholders.
What are the common types of project finance structures?
Common types include greenfield projects, brownfield projects, public-private partnerships, limited recourse financing, and non-recourse financing.
What are the main advantages of project finance?
Advantages include mobilizing large capital without impacting balance sheets, facilitating risk sharing, providing access to long-term financing, and enhancing private sector involvement.
What are some common sectors that utilize project finance?
Common sectors include energy, infrastructure, telecommunications, mining, and real estate.