Our financial instruments
Bank Guarantees, Bonds, Medium Term Notes, or other Bank Debt Instruments issued by banks rated ‘BB+’ or better, but this can be reviewed on a case-by-case basis. To guarantee the yearly payment for the investor
Sovereign Guarantee being ratified by the relevant authorities and departments, namely the Central Bank and Ministry of Finance in the respective countries. In some cases the Sovereign Guarantee may need to be confirmed by a Commercial Bank.
Resource Guarantee such as an Oil Guarantee or any other significant and valuable minerals or resources that the country has may also be considered.
Corporate Promissory Notes endorsed by a commercial bank can be useful if the project has bankable assets that can be used for leverage financing.
Letter to be issue from Ministry of finance (“Ministry”) Where a sovereign guarantee is not obtainable for projects under BOT and/or BOO, and/or PPP, the Ministry needs to execute a somewhat watered-down document with questionable enforceability, called a „comfort letter,” Such instruments cover the following matters.
- An offtake contract subject to that the Offtaker should be A+ rated by (S&P or Moody´s) to guarntee the yearly payment for the investor.
- In case of hotel and hospital projects etc. the guarntee can be through a management international company to operate and manage the project. The operating contract should be for the life of the loan and the operator should be A+ rated by (S&P or Moody´s) to guarntee the yearly payment for the investor during the period of the investment.
- Or by a leasing contract for the project during investment period with a company or government entities which is A+ rated by (S&P or Moody´s) to guarntee the yearly payment for the investor during the period of the investment.
In this case we need to issue an insurance policy from insurance governmental company to make “export-finance-structure” or from World Bank or their subsidiaries as for example Asian or African Development Bank or OMIGA etc. to guarntee the yearly payment for the investor during the period of the investment.