Transcript Fu nding projects in Greece, by Mr. Konstantinos

FUNDING PROJECTS IN GREECE
NATIONAL BANK OF GREECE S.A.
Konstantinos Venetsanos
Project Finance Division
Athens, 10 October 2014
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The risk profile of projects has changed due to:
 Decrease in project revenues due to the economic crisis,
 Unable to form reliable forecasts,
 Debt crisis has serious impact on government obligations (expropriations, VAT
refunds, payments of compensation, etc.).
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New terms of funding

Banks’ requirements have become more conservative,

Increased investor participation (from 20% to 40% -50% of project
budget),

Shorter loan tenors (Mini Perm),

Cash Sweep mechanisms,

Increased guarantees and securities (government and / or corporate),

Increased margins as a result of the increase of funding costs for the
Banks.
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Critical factors for the banking sector
 Upgrade creditworthiness Greek banks,
 Positive GDP growth rates,
 Reduced growth rate of non-performing loans.
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Infrastructure projects in Greece
Significant to the economic activity are Infrastructure Projects
 New technology Thermal Power Plants reducing CO2 emission
 New motorways that reduce travel time and distance
 Successful projects’ restart in December 2013,
 Accelerated payment procedures (expropriation, VAT refunds, payments of
compensation, etc..),
 Multiplier effects on the economy, particularly at regional level,
 Increase confidence of foreign investors and banks to participate in new
projects.
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Waste management projects
 NBG is involved in the financing of almost all waste
managed projects in Greece,
Western Macedonia
tpa
120,000
Total cost
€ 45 mio
Serres
tpa
60,000
»
€ 33 mio
Ilia
tpa
63,000
»
€ 37 mio
Financial needs for all of them ≈ € 60 mio
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Financing renewable energy projects
NBG Group data as at 31/12/2013
(amounts in millions. €)
Photovoltaic Parks
Windfarms
Small Hydro Plants
Biogas
Total
Power
(MW)
Cost of
investment
Approved
lending
100
931
31
23
258
1.228
52
35
200
698
37
18
1.085
1.573
953
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Public Private Partnership (PPP) Projects

NBG is actively financing :
Mainly in the field of waste management - schools - telematics




During the second quarter of 2014, contracts were signed for two PPP schools (22 schools
in total) in Attica (participation and program JESSICA),
Telematics Project (signed 30/6/2014).
Increased participation of EIB after successful recapitalization of Greek Banks
These projects contribute to environmental sustainability
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PPPs challenges
CHALLENGES
ACTIONS

Increase in cost of risk for private
investors,

Encouraging competition between the
private entities,

Increase in financial cost of the
project due to pricing of credit risk by
banks,

participation of EIB,

Increase in Equity requirements,
Available funds need to be directed
towards creditworthy projects,

Club Deals (syndicated loans),
Requirements for
letters of support.

Escape clauses,

Renegotiation clauses.


binding
banking
The relatively small size of the Greek PPPs is an advantage in the current situation
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European programme JESSICA
 Joint European Support relating to Sustainable Investment in Urban Areas,
 Initiative of the European Commission (DG Regional Policy) in cooperation with
the EIB in order to promote sustainable investment in urban areas,
 The financing of urban development is through the "conversion of subsidies" to
a funding mechanism “refundable grants”,
 The initiative provides for the establishment of Urban Development Funds
(UDF), which will be responsible for implementing the program through the
JESSICA Holding Fund,
 To Holding Fund is a fund of funds, managed by the EIB, which is established
for the investment of resources in Urban Development Funds,
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European programme JESSICA
 Enhanced mobility of capital for urban development and PPP focusing on
sustainability and environmental friendly solutions,
 Incorporating the experience of international financial institutions such as
the EIB,
 NBG participates in the programme acting as Manager of Urban
Development (UDF) for the regions of Attica, Western Greece, Ionian
Islands, as well as projects of the Operational Programme "Environment
and Sustainable Development" (EPPERAA),
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JESSICA ‘S STRUCTURE IMPLEMENTATION
JESSICA Holding Fund (HOLDING FUND)
MANAGEMENT (EIB )
COMPETITION, SELECTION
AND INVESTING IN UDF
OPERATIONAL
CONTRACTS
(OPERATIONAL
AGREEMENT)
URBAN DEVELOPMENT FUND (UDF)
LOANS, EQUITY FUNDS FOR
PROJECTS
INVESTMENT
AGREEMENT
(INVESTMENT
AGREEMENT)
REPAYMENT OF RESOURCES
TO IMPLEMENT PROJECTS
UDF
URBAN DEVELOPMENT PROJECTS
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European programme JESSICA
Indicative areas of interest :




Urban infrastructure (parking facilities and green areas),
Urban rejuvenation (refurbishment of buildings),
Public Networks (transport, water, sanitation, energy),
Health / education (hospitals, rehabilitation centers, etc.).
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An example of project within the scope of Jessica:
Municipality of Alexandroupolis’ Energy Saving Project
Regarding the contribution of Jessica for the implementation of energy saving project,
Municipality of Alexandroupolis is willing to realise the following project in the context of
Jessica initiative.
 Project budget of € 2,33 million
 Installing photovoltaic cells in 16 schools for producing electricity from RES,
 Replacing
2,028 lighting street lighting system throughout
Alexandroupolis type LED luminaires,
 7 Supply of electric vehicles for use by the municipal services,
the city of
 Phase 1 for eligibility has been completed.
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Thank you !
NATIONAL BANK OF GREECE SA
Project Finance Division
128-132 Athinon Avenue, GR104 42
Tel. : +30210 51 81 384
Fax : +30210 51 81 400
Email: [email protected]
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