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23 July 2009
Standard Bank wins Carbon Finance Deal of the Year award
Standard Bank has reinforced its credentials as a major player in the carbon markets by being awarded, with Camco International Limited (Camco), the Carbon Finance Deal of the Year' award from Environmental Finance magazine.
The deal was presented for the innovative 5.8 million tonne Certified Emission Reduction (CER) structured distribution and €15 million advance payment arranged by Standard Bank for Camco, a leading climate change business and carbon project developer. The distribution was four times oversubscribed, reflecting the success of the deal.
The transaction involved the structuring of a number of Camco's Clean Development Mechanism (CDM) projects into a tranched pool and the subsequent distribution of rights to shares of volumes of CERs flowing from tranches in the pool. Standard Bank also made a €15 million advance payment to Camco secured against the future cash flows arising from the sale.
The transaction featured a number of key innovations in the carbon market:
- The pooling of multiple diversified projects into a tranched structure that enhances the risk profile for buyers and adds value for Camco
- A professional and well-defined distribution process evidenced by Standard Bank's track record of 5 years in the emissions sector and the enthusiastic buyer response
- Providing Camco with a payment for future CER deliveries without requiring guarantees as to the future CER volume performance of the projects.
Geoff Sinclair, Global Head of Carbon Trading at Standard Bank, says of the award: "Standard Bank is delighted to receive this recognition. The Camco deal was particularly interesting in terms of the development of structures that are tailored to the specific risks in CDM projects, which we did by using a combination of classical structured commodity finance techniques adapted to the particular needs of the carbon sector."
Mark Nicholls, editor of Environmental Finance, says: "Our awards are designed to recognise excellence and innovation in environmental markets, and we felt that the Camco-Standard bank deal represented a significant step forward in the application of capital markets expertise to the emerging carbon markets."
Karin Ireton, Director of Group Sustainability Management at Standard Bank, says: "Finding business solutions is the most important way of moving forward in resolving global challenges. Our carbon desk is ideally positioned to assist companies in reducing risk and adding value to their carbon reduction efforts and is a central to the Standard Bank Group's sustainability efforts."
Read more about these efforts in Standard Bank's latest Sustainability Report.
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