Bayfront signs MOUs with 15 partner banks on framework for potential infrastructure loan acquisitions
- Officially commenced operations on 2 April 2020
- Signs MOUs with 15 banks to achieve alignment of understanding and catalyse steady pipeline of infrastructure and project finance loan acquisitions
- On track with strategy to address the substantial infrastructure financing gap in Asia-Pacific by mobilising private institutional capital
Singapore, 29 April 2020 – Bayfront Infrastructure Management Pte. Ltd. (“Bayfront”), a platform designed for institutional investors to access Asia-Pacific infrastructure debt, officially commenced its operations on 2 April 2020. The establishment of Bayfront builds on the successful issuance of Asia’s first securitisation of project finance and infrastructure loans through Bayfront Infrastructure Capital (“BIC”) in July 2018.
Bayfront is a 70/30 strategic partnership between Clifford Capital Holdings Pte. Ltd. (“CCH”) and the Asian Infrastructure Investment Bank (“AIIB”). Bayfront seeks to acquire predominantly brownfield project and infrastructure loans from financial institutions, warehouse and manage them, with the objective of distributing securitised notes to institutional investors in the public markets. Bayfront will sponsor, structure, and manage such distribution issuances, as well as invest in the equity tranches or vertical slices of its securitisation issuances to demonstrate alignment of interest with investors.
The execution of the Memorandum of Understanding (“MOU”) aligns the understanding between Bayfront and each bank for future collaboration on the takeout mechanism for infrastructure loans, including the key principles and criteria for potential transfers of infrastructure loans from each bank to Bayfront.
As part of the engagement strategy with financial institutions, Bayfront has signed MOUs with an initial list of 15 banks:
Bayfront has already commenced loan acquisitions from a number of these banks and will continue to expand its network of banks going forward.
Mr. Premod Thomas, Chief Executive Officer of Bayfront, said: “Building on the success of the BIC transaction in 2018, Bayfront is looking to scale up its portfolio to capture growth, while placing a strong emphasis on quality and diversity of assets. The banks who are active players in the regional project finance and infrastructure financing landscape are our key partners. Close collaboration and dialogue with these banks to ensure a steady pipeline of loan acquisitions is a key pillar in achieving our objective of crowding in non-bank institutional capital to address the large infrastructure financing gap in Asia-Pacific, while at the same time meeting these banks’ capital recycling needs. We look forward to a fruitful partnership with each of these institutions over the years to come.”
Ms. Gillian Tan, Executive Director and Head of Financial Markets Development at the Monetary Authority of Singapore, said: “The keen interest shown by the 15 banks which signed MOUs with Bayfront is testament to the strong potential of the platform in unlocking capital for infrastructure financing. These partnerships are a key element as Bayfront works towards mobilising private capital into infrastructure finance through innovative market solutions.”
Bayfront’s objective is to address the substantial infrastructure financing gap in the Asia-Pacific region. This will be achieved by facilitating the mobilisation of private institutional capital into the infrastructure financing market, which will in turn unlock capital for infrastructure financing by facilitating the recycling of capital and liquidity by banks, who have traditionally been the largest lenders in this sector.
About Bayfront Infrastructure Management Pte. Ltd. Launched in November 2019, Bayfront Infrastructure Management Pte. Ltd. (“Bayfront”) is a platform designed for institutional investors to access Asia Pacific infrastructure debt. It seeks to address the infrastructure financing gap in the AsiaPacific region by facilitating the mobilisation of private institutional capital into the infrastructure financing market.
Bayfront will acquire predominantly brownfield project and infrastructure loans from financial institutions, warehouse and manage them, with the objective of distributing securitised notes to institutional investors in the public markets.
Bayfront is capitalised at US$1.98 billion, comprising US$180 million in equity and US$1.8 billion in debt issuance capacity. The equity capital is committed by CCH and the Asian Infrastructure Investment Bank on a 70/30 basis respectively. Debt instruments issued by Bayfront to acquire and warehouse loans from banks benefits from a guarantee provided by the Government of Singapore.
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Establishment of Bayfront Infrastructure Management as a new platform to provide institutional capital access to infrastructure debt financing in Asia
Clifford Capital Pte. Ltd. (“Clifford Capital”) and the Asian Infrastructure Investment Bank (“AIIB”) have announced the establishment of Bayfront Infrastructure Management Pte. Ltd. (“BIM”), a first-of-its-kind innovative platform designed to mobilise a new pool of institutional capital for infrastructure debt in Asia. Clifford Capital and AIIB will be taking a 70% and 30% equity stake in BIM respectively. The establishment of BIM builds on the successful issuance of Asia’s first securitisation of project finance and infrastructure loans through Bayfront Infrastructure Capital (“BIC”), launched in Singapore in 2018.
For more details, please refer to the press release
Bayfront Infrastructure Capital’s US$458m securitisation is awarded 2018 Best Project Finance Deal, Best Structured Finance Deal and Best Bond by GlobalCapital Asia
Clifford Capital is pleased to announce that the US$458m project finance securitisation by Bayfront Infrastructure Capital Pte. Ltd. has been named by GlobalCapital Asia as the winner of the Best Project Finance Deal, Best Structured Finance Deal and Best Bond in the capital market awards for 2018.
GlobalCapital Asia noted the following in its awards citation:
“Finding novel ways to finance projects in Asia is vital… deals that further infrastructure and project finance in the region are noteworthy, and this year, Bayfront Infrastructure’s CLO stands out for using a creative structure to funnel cash into the sector.”
“… opening a new asset for project financing in Asia, and doing it with a highly sophisticated and complex deal, Bayfront’s CLO deserves recognition.”
Bayfront Infrastructure Capital Pte. Ltd. issued four classes of Notes in the first infrastructure project finance securitisation in Asia. Leveraging on Clifford Capital’s experience and expertise in project finance and loan portfolio management, Clifford Capital acted as Sponsor, Manager and Subordinated Note Investor in the transaction. Citi and Standard Chartered acted as Joint Global Coordinator for the transaction.