Ranajoy Basu

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The appetite for ethical finance shows no sign of slowing. But as the interest in Environmental, Social and Governance (ESG) finances rises, so too do concerns about impact- and green-washing: the practice of making false or misleading claims about apparent ethical credentials.

Naturally, as an embryonic sector, many complex questions about ESG investment remain unexplored. Institutions are thus actively navigating this constantly evolving landscape in order to develop a financial ecosystem where investments are, as the governor of the Bank of England, Mark Carney, put it, “both financially rewarding and environmentally sustainable”.
Continue Reading Shaping a sustainable financial ecosystem: how to integrate ESG factors

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Innovation and creating purposeful change for communities is at the very heart of what social impact finance is all about.  Such impact investments have never shied away from embracing that latest technological innovation or challenging the status quo.  In this vein, FinTech initiatives such as blockchain  have the potential to prove that they can be the catalyst for democratising data and opening new worlds of possibility to users and stakeholders around the globe.  A recent Harvard Business Review research project backs up these claims, and believes that there is strong evidence that blockchain can not only transform businesses and governments, but also have a profound impact on society as a whole.
Continue Reading Waves of change – how FinTech can drive the future of social impact finance

The green bond market is currently one of the fastest-growing fixed-income segments, with issuances tripling between 2013 and 2014. There is a sense of excitement and optimism surrounding the market – initially led and developed by the multilateral development banks (MDBs) and international financial institutions (IFIs), but now actively promoted, sponsored and supported by the…

Running man - RBSUThe Investment Plan, developed by the European Commission, has the potential to be one of the most important and radical changes to how the European Union operates in the last 25 years.  Not only will it seek to harmonise the financial and regulatory barriers to investment, but it will look to harness the collective…

With yet another foreign convertible bond default hitting our desk, we cannot help but wonder what the future has in store for Asian convertible bonds and debt capital markets restructurings.  This is particularly relevant when you consider that Indian companies and banks issued foreign currency bonds aggregating up to approximately $6.3 billion in the first quarter of 2013.  This momentum continued throughout 2013 with Indian companies expected to raise another $10 billion by the beginning of 2014 by issuing foreign currency bonds in the international capital markets.

The Story so far

The convertible bond has always been a favourite of corporate India.  Turning back the clock, one would recall that, particularly between 2005 and 2008, several companies across multiple industries used a variety of structures to access the international debt capital markets by issuing foreign currency convertible bonds (FCCBs) to investors. Such issuers included National Thermal Power Corporation, Indian Oil Corporation, Bharat Petroleum Corporation, Power Finance Corporation, Tata Steel, Tata Communications, Vedanta, Bharti Airtel, Amtek Auto and Rural Electrification Corporation (just a few names amongst an endless list of issuers back in the day).

Fast forward to 2014 and FCCB defaults have dominated recent headlines (think major companies like Sterling Biotech, KSL and Industries and Suzlon Energy).
Continue Reading Indian Bond Defaults and Bond Restructurings: More Scheming Ahead?

So called ‘sunshine backed bonds’ are one of the newest and most exciting asset classes to enter the asset-backed securities market since the financial crisis. The resurgence of the market has led to a number of esoteric ABS issuances in recent months but it was solar energy that seemed most ripe for applying securitisation techniques (which provide an especially powerful financing tool). Indeed, given how this financing technique revolutionised the mortgage finance market 30 years ago, it now seems poised to play a role in transforming the renewable energy markets across Europe.

The case for securitising solar

In essence, securitisation allows companies to access the capital markets and in so doing to bring down their cost of capital and improve liquidity. Pools of illiquid assets are sold to bankruptcy-remote vehicles which then issue bonds to investors which are backed by the pool of assets. The originator of the assets is able to turn illiquid assets into saleable securities and in so doing shift those assets, and the risk of ownership, off its balance sheet in return for new finance.
Continue Reading Sunshine backed bonds – time to look on the sunny side?

Further to proposals by the European Securities and Markets Authority (“ESMA”), the Prospectus Directive regime in Europe, particularly the requirements in relation to the form of prospectuses, transaction summaries, final terms and supplements have undergone some major changes. These changes have been brought about by amending the Prospectus Directive and the Commission Regulation (EC) No 809/2004 (the “Amending Regulations”), which came into effect on 1 July 2012. As a result, issuers with established programmes or those looking to establish new programmes will have to carefully consider the implications of the new requirements.
Continue Reading The EU Prospectus Directive Regime – Winds of Change