Global Bonds Report
With new projects being announced every day and experts predicting a record-breaking year for the installation of new wind power in the US, the FPL Energy American Wind bond deal has given credibility to the technology associated with wind power and an investment grade rating has opened the door for other wind developers to get involved in project finance. By Alison Healey.
Chile's private-sector Costanera Norte toll road project is a veritable melting pot: it features an Italian sponsor working with a Dutch bank, an American insurance company and a multi-lateral development bank to build a road in metropolitan Santiago. But financiers are quite discriminatory about one issue: in order to avoid the currency mismatch that has plagued so many other LatAm toll roads over the past decade, Costanera's upcoming bonds will be denominated in pesos and sold in the local markets to institutional investors.By Nicole Gelinas.
Project bonds have hardly emerged this year in Asia. However, what is becoming an increasing trend is the tapping of the debt capital market on a corporate basis by developers and project companies, especially those in the oil & gas sector and in the power sector. Minerva Lau reports.
The Malaysian bond market has been described in the past as the saviour of the country's project finance market when bank financing dried up in the wake of the 1997 Asian crisis. However the bond market today is undergoing a volatile correction. This may hurt sponsors in the short term but the fixed income market is still the most viable funding source for projects. By Sharon Klyne.
The market for UK private finance initiative (PFI) bonds is maturing and as such is facing some growing pains. Reduced underwriting fees, fluctuating investor markets, uppity rating agencies and even some bank loan competition are the challenges the market has had to face this year. But it has been a year of unprecedented high issuance, nearing £2.5bn thus far. By Rod Morrison.
Slow progress and setbacks continue to dog the evolution of the hoped-for European project bond market. Nevertheless, a few notable infrastructure funding issues have hit the market and a few more can definitely be pencilled in going forward. The most significant ones, however, are more hybrids of corporate and project elements than pure project deals.By Daniel O'Sullivan.