Project financing are financial arrangements made to support clients to set up, expand and promote specific projects (which are operated as separate business entities), where the income generated by these projects are used to repay the financial obligation.
This requires a blend of industry and financial proficiency in order to evaluate the project and structure the optimal funding package for the business. We at Seylan Bank, finance projects either as the Sole Lender or in the capacity of Lead Banker, where we arrange through a consortium of banks.
How to apply
The project’s cash flow forecasts are a primary consideration, in establishing viability. The evaluation process will include a validation of project feasibility in several aspects such as the sponsor’s history, technology and production, market and management in all aspects, regulations and statutory approvals.
Given below are the information generally required for “Any” financing proposal.
- Proposed Project
Overall description of the service or production process, including details of the project site, facilities, technology, materials, consumables, utilities, manpower/management, organizational structure, licensing, environment and other regulatory clearances with the implementation timelines and critical path activities.
The business experience and other background information with the technical expertise of the principal sponsors, shareholders and directors.
- Market scope and action plan
Market served by the business entity, covering the market structure, the growth, prospects, competition, channels of distribution/ delivery, opportunities, regulatory and tariff relating to the business.
- Risk analysis
This includes analysis of construction risk, operational risk, off-take risk, management risk, industry risk and political risk etc., and the ways and means of mitigating them.
- Project Cost & Financing Plan
Provide the total project cost including a detailed break up. Financing plan should include how the proposed project will be financed including equity (sponsor’s contribution) and debt (borrowings) breakups.
- Profitability & Cash flow Projects.
Forecast of the future operations of the project including projected profit/loss account, projected balance sheet and projected cash flow statement for the tenure of the proposed facility.