MASTERING PROJECT FINANCE

Bangladesh, being one of the fastest growing emerging countries, has immense potential for macro-economic development. To cope with this development pace, huge investment in infrastructure and industrial projects is required by both public and private sectors. Project finance enables ventures to raise focused and risk sharing financing in the key industries and it is the leading method of cash strapped governments to introduce private sector skills, disciplines and funding in sectors ranging from transportation PPP, power, oil & gas, telecom, manufacturing and many more. At the same time, it's imperative that officials of financial institutions and corporate houses need a good understanding and expertise on the critical project financing approach. Realizing this fact, IDLC Finance Limited and Euromoney Learning Solutions jointly designed this comprehensive workshop named "Mastering Project Finance" for the project finance practitioners.

IDLC Finance Limited is one of the largest multi-product non-bank financing institutions in Bangladesh with focus on corporate, retail and SME sectors. Euromoney learning solutions is a world leading provider of premium public course, e-learning and tailored learning solutions.

The workshop was conducted by Edward Bodmer, a global expert on project financing. He has created innovative forward pricing, productivity measurement and investment valuation software for consulting clients throughout the United States. He has taught project finance economics and mechanics throughout the world, and formulated significant government policy and corporate strategy in the US.

The workshop focused on issues arising in alternative types of project finance transactions with case analysis across the global market. The use of valuation analysis of debt and equity was discussed. It also highlighted the risk factors in project finance, risk mitigation techniques and debt restructuring.

The two-day workshop ended with an interactive discussion session which was conducted by Kazi Farhan Zahir, Head of Structured Finance, IDLC. In the discussion session, the participants raised several key issues and asked for expert opinion from the distinguished panelists. A.K.M Abdullah, Senior Financial Sector Specialist of the World Bank, Edward Bodmer, Trainer of Euromoney, M. Jamal Uddin, Deputy Managing Director, and Mesbah Uddin Ahmed, Head of Corporate IDLC Finance Ltd., were in the panel. The interactive session was followed by a certificate giving ceremony among the participants.

A.K.M Abdullah
In the project financing sector, Bangladesh depends on international financing and foreign consultants. We need to develop our local capacity to reduce this dependency. In Bangladesh, the financial sector is driven by commercial banks as we do not have vibrant equity market and bond market. Commercial banks are not suitable for project financing beyond 5-6 years. The bankers are good at banking but not at project financing because it requires different kinds of expertise. That's why we need to focus on developing human resources for financing large projects. The country is stuck in the power sector infrastructure due to lack of proper understanding of the technicalities of infrastructural project financing.

Mesbah Uddin Ahmed

Risk analysis is one of the most important factors of project financing. We need to have proper risk analysis tools for assessing the projects as every project is unique in nature. The major aspects of a project analysis are the entrepreneur, market, technology and financial projections. For large and infrastructure project, land, government agreements, environment and social aspects also influence a lot for the success of the project. Due to overall concern of environmental degradation, we should undertake appropriate measure of environmental safeguard for large projects which will also help us to get low cost financing from DFIs.         

M. Jamal Uddin
M. Jamal made concluding remarks by thanking all the participants, panelists and course coordinator. He said this workshop was a timely initiative as our country was going to implement many large infrastructure projects and without good project financing knowledge, we would not be able to handle them. He also added that the workshop would add value to excel the capabilities of the participants in order to assess the projects prudently and would benefit their respective organizations as well.