The impact of this small-scale technical assistance project is a broadened long-term financing sources through wider selection of fixed-income investment tools for expressway companies to tap into the capital markets by December 2008. The outcome is a detailed executable plan on carrying out the debt structure to formulate and execute the asset-backed securitization (ABS) transaction in the Yunnan province by June 2008.
|Project Name||Asset-Backed Securitization for Expressway Financing and Corporate Debt Restructuring in Yunnan Province|
|Country||China, People's Republic of|
|Project Type / Modality of Assistance||Technical Assistance
|Source of Funding / Amount||
|Strategic Agendas||Inclusive economic growth
|Drivers of Change||Knowledge solutions
|Sector / Subsector||
Finance - Infrastructure finance and investment funds
|Gender Equity and Mainstreaming|
|Description||The impact of this small-scale technical assistance project is a broadened long-term financing sources through wider selection of fixed-income investment tools for expressway companies to tap into the capital markets by December 2008. The outcome is a detailed executable plan on carrying out the debt structure to formulate and execute the asset-backed securitization (ABS) transaction in the Yunnan province by June 2008.|
|Project Rationale and Linkage to Country/Regional Strategy||Part of ADB's financial sector strategy, as stipulated in the most recent Country Partnership Strategy, is to introduce innovative financial modalities and assisting provincial and local level authorities to access capital markets by broadening the range of financial products available, including securitization and use of guarantees.|
|Impact||Broadened long-term financing sources through wider selection of fixed-income investment tools for expressway companies to tap into the capital markets by December 2008.|
|Description of Outcome||Detailed executable plan on carrying out the debt structure in order to formulate and execute the ABS transaction in Yunnan by June 2008.|
|Progress Toward Outcome||To be determined after the consultants have been fielded.|
|Description of Project Outputs||
Identification and evaluation of the availability of net toll revenues and stability of cash flows from existing expressways recommended by YHIC
Review of existing debt structure and asset collateralization, identification of the need for debt restructuring and recommend plans to carry out needed measures
Recommendation of options for the ABS transactional structure for efficient fund raising and streamlining the debt structure for the concerned expressways
Identify policy, legal and regulatory impediments and transaction risks for this ABS issuance, and recommend proper mitigation measures with a view to improving and refining the understanding of reforms that are still required
Assistance in selection of the investment bank and other intermediaries for the transaction
Preparation of a report providing detailed executable plans on carrying out the debt restructuring and formulating the ABS
|Status of Implementation Progress (Outputs, Activities, and Issues)||
No TA Agreement Letter was sent in view of the small amount of this TA and in the absence of any unusual obligations on the part of the PRC Government.
The individual International ABS Specialist/Team Leader was engaged on 27 Feb. 08. Recruitment for a National Debt Restructuring Specialist was cancelled as the potential candidate's counteroffer was deemed unacceptable by EARG.
Delays are being experienced due to slow progress in regulatory reforms for the ABS market as well as changes in the expressway investment pipeline of ADB in Yunnan where the pilot project will be conducted.
The ongoing global financial crisis has halted the process of establishing a regulatory framework for securitization in the PRC. However there are still sporadic attempts to revive the securitization. EAFM will discuss with the EA and plan next steps for TA implementation.
A major change in scope and implementation arrangements was approved by VP02 on 9 December 2009. The change is to support a local bond issuance of the municipality of Kunming in the province of Yunnan. The TA will now facilitate the issuance of local bond instead of the issuance of asset backed securites (ABS) of expressway companies.
ADB sponsored the Development Research Center of the State Council of the PRC to hold a workshop on "Local Government Finance and Risk Management International Experiences & Lessons" in Beijing, PRC on the first week of December.
The workshop was attended by senior members of various government stakeholders such as Ministry of Finance, National Development and Reform Committee, People's Bank of China. Non-government stakeholders such as representatives from China Development Bank, Cinda Asset Management Company and Huaxia Bank also participated in the workshop sessions.
|Geographical Location||East Asia|
Summary of Environmental and Social Aspects
|Stakeholder Communication, Participation, and Consultation|
|During Project Design|
|During Project Implementation|
|Consulting Services||The TA will engage one international and two national consultants for a total of 6 person-months including the team leader and international ABS specialist (1.5 person-months), national ABS specialist (3 person-months), and national debt restructuring specialist (1.5 person-months). The consultants will be selected and engaged on an individual basis in accordance with ADB's Guidelines on the Use of Consultants.|
|Responsible ADB Officer||Lee, Seung Min|
|Responsible ADB Department||East Asia Department|
|Responsible ADB Division||Public Mgt, Financial Sector and Regional Coop Division, EARD|
Yunnan Provincial Department of Transport
Lu Yun Feng
1 Western City Ring Road, Kunming 650031, PRC
|Concept Clearance||18 Dec 2007|
|Fact Finding||11 Mar 2007 to 25 Mar 2007|
|Approval||11 Jan 2008|
|Last Review Mission||-|
|PDS Creation Date||14 Feb 2008|
|Last PDS Update||19 Sep 2013|
|Approval||Signing Date||Effectivity Date||Closing|
|11 Jan 2008||-||11 Jan 2008||30 Jun 2008||31 Dec 2010||-|
|Financing Plan/TA Utilization||Cumulative Disbursements|
|150,000.00||0.00||50,000.00||0.00||0.00||0.00||200,000.00||11 Jan 2008||106,360.16|
Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.
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|Title||Document Type||Document Date|
|Asset-Backed Securitization for Expressway Financing and Corporate Debt Restructuring in Yunnan Province||TA Completion Reports||Aug 2013|
Safeguard Documents See also: Safeguards
Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.
None currently available.
Evaluation Documents See also: Independent Evaluation
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