Basic Project Requirements

• positive business reputation of the borrower and project sponsors;
• sponsor’s experience in a given industry - at least 3 years;
• absence of unproved industrial technologies in the project;
• focused business strategy, accurate and clear business model, high stress resistance to changes of key project parameters;
• technological or commercial link between the project and the core business;
• stable financial position of the borrower and/or the project initiator;
• stable or dominant market position and/or existence of long-term off-take agreements;
• at least 30% to 50% participation of the initiator’s and/or the borrower’s in the project budget;
• availability of funds for debt servicing and for realization of investment obligations to the project on the investment stage;
• readiness for restrictions in material financing decisions, fulfillment of financial covenants, other control measures;
• economic efficiency of the project (IRR – minimum 20%, positive NPV, DSCR>1.3, payback period – less than 10 years);
• availability of security.

Basic stages of project financing:

1. Client’s application to the bank and primary review of the project
2. Negotiation of conditions precedent, signing of a mandate letter
3. Complex project review
4. Bank’s Credit committee approval
5. Finalization of credit and security documentation, fulfillment of conditions precedent, opening of a credit line.
6. Monitoring of project realization.

The time to review a project financing issue, taking into account the structure and terms of financing, varies between 2 and 6 months.