- Financing Capability
- We provide various financial arrangements for clients in need of creative financial methods that would be an important key to their mega projects. It demands highly advanced capability to finance projects at a competitive term, following the planned schedule. Samsung C&T have developed financing capabilities in a large number of projects across the world for decades. Our experience by active involvement and consequent management in diverse projects has been the valuable assets to provide the most optimal solution.
Project Finance & Investment
We develop projects and arrange funds by project finance that is provided to a foreign project company that plans to purchase plants, facilities and technical services from Korean companies. Since the value of the project is estimated based on the project expecting cash flows, we are in an attempt to make solid project structure and revenue source for the most competitive terms and conditions. We work as a coordinator to co-finance projects with many of export credit agencies, multilateral development agencies and banks and to negotiate to have governments issue sovereign guarantee for the reliability of the project.
Also, We participate in a variety of projects from small to mega as an equity investor. It enables a project to be more stable and reliable to sponsor groups. We also identify and invite other strategic / financial investors to build a feasible and solid project structure. In addition to the equity injection, we organize projects whose return can make appropriate return for relevant investors and risk can be reduced to an acceptable level.
Our record funded by project finance & Investment
- - Mexico NorteⅡ Combined-cycle Power Plant 433MW
- - Kazakhstan Balkhash Thermal Power Plant
- - Mexico Manzanillo LNG Receiving Terminal
- - Australia Victorian Desalination Plant
- - Ghana Tema Oil Refinery Phase 2
Project Finance structure
Terms & Conditions
| Interest Rate |
Flexibly applicable according to the nature and economic feasibility of the project (but within the limit of OECD Arrangements in case of Export credit) |
|---|---|
| Repayment Term | |
| Repayment of Principal | |
| Security |
- Pledge or mortgage on borrower´s assets - First priority assignment of the rights of the borrower or the sponsor and over the insurance - Pledge over shares of the borrower - Corporate guarantee or support letter of the sponsor or the government of the project site |
| Consultants | Legal, Technical, Insurance, Environmental consultants with sufficient knowledge and experience in the field |
Direct Loan (ECA Loan) & Insurance
Direct Loan is a credit service providing loans to foreign purchasers who buy goods and services from Korean companies. This loan from Korean export agencies/banks is to be repaid in two or more years. A foreign importer directly executes a loan agreement with a Korean bank providing the amount of fund purposed to buy goods and services from a Korean seller. It covers value of contract less advanced cash payment and has various repayment terms according to type of products and services, for example, water projects are given 18 years for it. The debtors can use several loan disbursement methods - letter of credit, direct payment and reimbursement method.
Also, We organize the export credit insurance program (buyer credit) with ECA Loan. It helps financial institutions at home or abroad hedge the nonpayment risk of export proceeds by importers or importing countries’ financial institutions for those transactions exceeding two years with a deferred payment basis.
Risks Covered
| Political Risks | Commercial Risks |
|---|---|
|
- Country Risks pursuant to the OECD Arrangement - When the policyholder has no fault as they occur outside the Republic of Korea |
- Financial contract counterparty’s bankruptcy - Financial contract counterparty’s payment incompetence due to debt freezing by the court in the importing country or debt rescheduling contract with debtors - Payment delays of over two months after the financial contract counterparty’s payment date |
Our record funded by Direct Loan (ECA Loan) & Insurance
- - Gabon Government Administration Network Project
- - Vietnam An Hoa Paper Plant
- - Nicaragua Photovoltaic Power Plant
- - Russia DD Shipping Intermediate 26K BC Vessel
Terms & Conditions
| Borrower | Foreign importers or governments |
|---|---|
| Currency | A foreign currency |
| Coverage | Export contract value less required cash payment |
| Fees | Exposure Fee, Commitment Fee, etc. |
| Interest Rate |
Fixed Rate: No less than CIRR Floating Rate: LIBOR + Margin |
| Repayment Term | Up to 18 yrs depending on the project |
| Repayment of Principal |
Ships : Basically annual equal installments Other project : Basically semi-annual equal installments |
| Security | L/G, irrevocable L/C, promissory note issued or confirmed by the importer's government, the central bank of the country, or creditworthy financial institutions |
| Loan Disbursement | L/C Method, D/P Method, Reimbursement Method |
| Credit Lines | Project Line of Credit, Revolving Line of Credit, Framework Agreement |
EDCF
EDCF (Economic Development Cooperation Funds) is a bilateral ODA loan program of the Korean government. The funds are provided for recipient countries to boost its economic growth and to have positive impacts on the communities. After a Loan Request is received from the government of a recipient country, Korea Export Import Bank in charge of EDCF evaluates the feasibility of a project and enters into a Loan Agreement. It is mainly offered at annual rates of 0.01 to 2.5 percent and recipient countries fall into 5 categories according to the GNI per capita. EDCF covers approximately 85 percent of total project cost and requires the recipients to pay back within up to 40 years including grace period of 7~15 years.
Our record funded by EDCF
- - Bosnia & Herzegovina Hospitals Modernization Project Phase2
- - Nicaragua, Vocational Training Centers Project
- - Sri Lanka Galle Potable Water Project
- - Senegal Maritime Infrastructure Establishment Project
Terms & Conditions
| Loan amount (*) | Up to 85% of total project cost |
|---|---|
| Currency | Korean Won |
| Guarantee | Guaranteed by central government or central bank |
| Interest rate (**) | Up to 0.01~2.5% per annum (Varies according to the GNI per capita of the recipient country) |
| Maturity (**) | Up to 40 years including about 15 years’ grace period |
| Repayment | Every six(6) months |
(*) Exception : 100% of total project cost for the Least Developed Countries (UN Classification)
(**) Loan Condition will be fixed through negotiation between two governments in line with EDCF regulation. And the above table is only for reference.
Ship fund
We organize the ship fund for purchasing vessels and charter-out for long-term to secure stable revenue such as dividend and capital gain. We participate in the project as a catalytic investor with other institutional Investors’ consortium and public offering.
Our record funded by Shipfund
- - Ship fund (primary) - 2 units of 180K Bulk Carrier
- - Ship fund (secondary) - 2 units of 82K Bulk Carrier
- - Ship fund (tertiary) - 2 units of 57K Bulk Carrier
- - Ship fund (quaternary) – On going
Ship fund structure
