Investing in big programs usually require a lot of money. A single person cannot provide this kind of money. Even if you think that you can run the program on your own, you will still need external financing. Industrial programs and government initiatives usually require external financing from investors. Hence, there must be parties that run this kind of funding so that there can be accountability. If these initiatives lack proper management, funds will be lost, and the investors will suffer huge losses. For this reason, below are some key parties that run the Philippines Commercial Project Finance you should know about.
The private sector partner or the owner of the program is the first party involved in this funding program. This does not refer to one person but a corporation or partnership. This is, therefore, a group of persons that take the role of managing the finances that run the initiative. They form an organization called a projectco. It is usually the bloodstream of the program and oversees all contracts, borrowing, managing, and construction.
The second key point of the program is the sponsor. This is the individual that manages the program. He/she is, therefore, the owner of the program. If the program happens to succeed, the sponsor will get profits. The sponsor receives benefits through ownership rights or management contracts. Thus, it is the responsibility of the sponsor to see through the success of the initiative regardless of all the risks involved.
The third party is the lender. This is also not a single person but a group of commercial banks, investment banks, and several institutional investors. These lenders provide finances for running the initiative. Thus, they form a unit or syndicate that pools the funds that will be used in running the initiative.
Out of the lenders comes a fourth party called the agent. An agent is simply one of the lenders that has been chosen to become the main representative. Therefore, the agent will represent the other lending parties when administering the loan. The agent cannot appoint him/herself. Thus, the lenders must select one lender to become their representative. They can even vote if they have to when more than one agent has been proposed.
The account bank is the fifth element that is involved in this process. This is usually the lender that will be responsible for holding the entire accounts that will run the program. Therefore, any finances generated by the initiative have to pass through the selected account bank that has been chosen by the lenders.
The equity investors are the sixth elements that run this kind of financing. These include lenders as well as sponsors that are not active in running the initiative. Lenders thus become shareholders and get profits that are added to their loans. Sponsors can decide to buy shares as they are also shareholders.
The contractors, customers, and suppliers are also other vital elements. Suppliers will provide materials for running the initiative. Contractors will be the designers and builders of the project while the customers will help in running the initiative as well as the cash flow.
The private sector partner or the owner of the program is the first party involved in this funding program. This does not refer to one person but a corporation or partnership. This is, therefore, a group of persons that take the role of managing the finances that run the initiative. They form an organization called a projectco. It is usually the bloodstream of the program and oversees all contracts, borrowing, managing, and construction.
The second key point of the program is the sponsor. This is the individual that manages the program. He/she is, therefore, the owner of the program. If the program happens to succeed, the sponsor will get profits. The sponsor receives benefits through ownership rights or management contracts. Thus, it is the responsibility of the sponsor to see through the success of the initiative regardless of all the risks involved.
The third party is the lender. This is also not a single person but a group of commercial banks, investment banks, and several institutional investors. These lenders provide finances for running the initiative. Thus, they form a unit or syndicate that pools the funds that will be used in running the initiative.
Out of the lenders comes a fourth party called the agent. An agent is simply one of the lenders that has been chosen to become the main representative. Therefore, the agent will represent the other lending parties when administering the loan. The agent cannot appoint him/herself. Thus, the lenders must select one lender to become their representative. They can even vote if they have to when more than one agent has been proposed.
The account bank is the fifth element that is involved in this process. This is usually the lender that will be responsible for holding the entire accounts that will run the program. Therefore, any finances generated by the initiative have to pass through the selected account bank that has been chosen by the lenders.
The equity investors are the sixth elements that run this kind of financing. These include lenders as well as sponsors that are not active in running the initiative. Lenders thus become shareholders and get profits that are added to their loans. Sponsors can decide to buy shares as they are also shareholders.
The contractors, customers, and suppliers are also other vital elements. Suppliers will provide materials for running the initiative. Contractors will be the designers and builders of the project while the customers will help in running the initiative as well as the cash flow.
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You can get a summary of the things to consider before choosing a Philippines commercial project finance company and more info about a reputable company at http://www.aayinvestmentsgroup.com right now.
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