Frequently asked questions
Everything project directors ask before the first call: the model, the collateral, the timeline and the costs.
What is structured finance?
A structured project finance solution allows projects to secure funding without resorting to traditional debt financing such as standard bank loans. Instead, the approach leverages underlying assets: these can be assets owned by the project owner or by a cooperation partner, often called a sponsor. The assets act as the trigger that makes it possible to obtain the necessary project funding while minimizing or even avoiding new liabilities.
This method is particularly useful for large-scale projects that require significant capital but wish to avoid the risks and obligations associated with conventional borrowing.
How much capital is required, and is the asset safe?
The amount and value of the underlying asset are carefully balanced against the required project funding. Importantly, the asset always remains under the full control of its owner. In the case of cash assets, the funds stay in the owner’s custodial account at their own bank for the agreed duration. There is no requirement to provide a bank guarantee or to pledge the asset directly to the project. The asset remains safe and securely managed by its owner throughout the process.
Can gold bullion be used as an underlying asset?
Yes. Gold bullion can be used as an underlying asset for structured finance. The process is straightforward and based on the LBMA (London Bullion Market Association) market price. The gold must be securely stored at a bank or an approved security facility for the entire duration of the arrangement. We arrange an adequate loan facility, which the client holds in their custodial account at our partner bank.
For other types of assets, special procedures or additional insurance may be required before they can be accepted as suitable collateral. More on this under underlying assets.
Which countries do you operate in?
We provide project finance solutions in all countries, except those banned or restricted by legal authorities or falling under terrorism-related categories. During the initial compliance process we will promptly confirm whether your project’s location is eligible and whether it can generally be accepted under our guidelines.
How long does funding take?
The funding process can be completed, either in full or in part, in less than one quarter. In some cases the distribution of project proceeds can be accelerated and made available even sooner, starting from the moment the compliance process is completed and the finance agreement is signed and executed.
Who qualifies?
Any company with an approved project or a proven track record of operations is eligible for support. This also includes new business developments at an early stage. The essential requirement is that the company, either through its own assets or with the support of a sponsor, can provide sufficient assets to support the execution of the structured finance solution.
In short: both established companies and new ventures may qualify, provided adequate underlying assets are available to back the financing arrangement.
What does the service cost?
There are no advance fees: the initial advisory, the compliance process and the structuring with licensed partners and banks are free of charge. Once financing is in place, a fee of 1.5 percent is invoiced by the supervising law firm A&A and paid directly from the project funds.
What is the minimum project size?
Projects start at 30 million EUR/USD, ideally 50 million and above. The facility itself can extend to 5 billion EUR/USD and cover up to 100 percent of the project investment. Underlying cash assets start at EUR 50 million, gold assets at EUR 100 million. All criteria are summarized under how it works.
Do the structured finance proceeds have to be repaid?
Unless otherwise agreed, there is no repayment of structured finance proceeds. The financing is non-recourse and requires no hypothecation of project assets, which keeps the balance sheet of the project owner unencumbered.
Who supervises the process?
Every mandate is overseen by the international law firm Abogados y Asesores, S.L.P. (A&A), established in Madrid in 2008, with oversight provided through its Frankfurt office. The firm conducts the compliance procedure together with the client and supervises each stage of the structuring. More about the setup on the about page.
Question not answered here? Write to us via the financing request form or read how the model works in detail.
Send us your financing request
Share a project teaser with the required cash flow and details of the underlying assets. We will promptly advise whether and how structured financing can be achieved. No advance fees.