DBS Bank said yesterday that it has set up a dedicated project finance team in order to serve its corporate and sovereign customers as Asia develops its infrastructure.
The team will initially be made up of four professionals and will be led by Lim Wee Seng, managing director for project finance. Lim joined DBS in May 1995, and has originated and led key transactions for the bank. These include multi-billion dollar stapled financing packages supporting the acquisition of Senoko Power and PowerSeraya and the S$2.25 billion ($1.64 billion) financing of Huaneng Group's purchase of Tuas Power. Outside Singapore, his credits include the $2 billion project financing for a Reliance Petroleum greenfield refinery.
Prior to his new role, Lim was a senior vice-president in the institutional banking group, covering the energy, chemical and infrastructure sectors. He reports to Amos Tan, managing director (energy, chemicals, infrastructure) of institutional banking.
According to Asian Development Bank estimates, Asia will require infrastructure investments of $750 billion a year from 2010 to 2020, or almost $8 trillion for the decade as a whole. In particular, China, India and Indonesia are projected to make significant investments over the next few years to increase their power generation capacity to meet domestic consumption needs.
Lim said in a statement that, "with the growing demand for infrastructure, energy and natural resource flows across Asia, companies are increasingly looking to invest in Asia's growth through the development of large-scale projects. We see significant opportunities for DBS arising from these developments and believe this potential would be better captured by a dedicated project finance team, due to the capital and time-intensive nature of arranging and executing typically long-tenure deals".
Project finance is not a new venture for DBS, Singapore's biggest bank, but previously it has been undertaken by bankers covering specific industry sectors within its institutional banking group.
Across Asia, DBS has been involved as mandated lead arranger for over $2.5 billion in project finance transactions in the past two years. This places the bank among the top 15 mandated lead arrangers in Asia-Pacific (ex-Australasia) in 2008 and 2009.
Earlier, in 2003, it was sole arranger and underwriter for Singapore's first desalination plant, a project sponsored by Hyflux. Since then, DBS has extended its reach beyond Singapore and into the region. It was coordinating arranger for the Rmb1.1 billion ($161 million) project financing for Vopak Shanghai in 2004, one of the first long-dated renminbi project financings arranged by a foreign bank. A Rmb268 million loan for the phase two expansion of Vopak Shanghai was successfully completed in 2009 by DBS and the existing lenders.
According to the bank, the establishment of a dedicated team will "further increase focus on the business and better service customers amid growing demand for project financing in Asia".