Current Affairs · Banking Regulations & Project Finance
Under the tighter project finance rules for real estate, lenders are required to maintain the Debt-to-Equity ratio at the same level throughout the project lifecycle. What is the most direct implication of this rule for developers?
- 1Securitisation of future receivables after handover will be barred
- 2External commercial borrowings cannot be obtained after project completion
- 3Developers will find it harder to alter capital structure mid-project in a way that reduces their own financial commitment✓
- 4Refinancing completed projects through capital markets becomes restricted
Correct answer
Developers will find it harder to alter capital structure mid-project in a way that reduces their own financial commitment
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