>> Many things have changed recently in the syndication market. We're living periods of crisis, high degree of volatility. And so, what we see as a normal syndication strategy nowadays, if we can define strategy as normal, is completely different from what happened in the past. The crisis has really reshaped the market for syndication. >> Yeah, yeah, well, indeed. What are the forces behind it? >> well, good point. There have been many things that have been as a driving force for this kind of change. I believe that probably one of the most important has been the financial crisis effect on banks. If you look at the past most of the funding flowing to infrastructure came from banks. And so, banks were really the most important actors in this market. After the turmoil of 2008, after the demise of Lehman authorities and regulators understood that probably they had to intensify the regulatory approach towards banks. And a series of new regulations have been enacted after Lehman in order to require banks to strengthen their own position and to show themselves as more robust vis-a-vis the investor community. All the bulk of regulation going under the name Basel III has really required banks to be more capitalized. But you can appreciate that if you have to give more capital to banks, banks don't have this capital for free and so they have to optimize the lending policy. And Basel III has also introduced a couple of additional constraints to banks. One of them is particularly important for project and infrastructure finance. And this constraint is called net stable funding ratio. A net stable funding ratio is telling you more or less a story of this kind. If you're a bank and you're lending long term, which is the typical case of project finance. Project lasts for 20, 25 years, and on average the traditional tenure of bank loans for project finance was running between 12 - 15 years. If you want to lend for such a long term, you must fund yourself at the same maturity. Basel is not saying that if you are lending with a maturity of 15 years you have exactly to match with the funding of 15 years. But, in any case, Basel is telling you that you don't have to mismatch too much the average duration of the assets with the average duration of liabilities. And you can understand when the market gets into a crisis period, funding a bank on such loan maturity is not exactly an easy task. So, if you don't have the possibility to collect such a big amount of money long term, you are constrained on the lending side. So, from my point of view, what has been really the driving force of the reshaping of the syndication loan market, is that unfortunately for them, banks could also be eager to lend. But unfortunately, the regulator hampers a little bit this possibility. >> When other banks refrain from lending, what other alternative sources of financing can there be? >> well, it is exactly a good point because, on one side banks are refraining from lending. If you look at the market data after Lehman demise. You see that the amount lend by banks using traditional syndicated loans, the project finance is not at the same level of pre-crisis period. There has been a rebound, but the rebound has still to come. So, the problem remains if banks do not lend. It is obviously important to find backup sources of financing. Luckily enough for us what we're are experiencing now, is a period that is characterized by a very low level of yields for most traditional asset classes. Stocks are overvalued. Bonds are yielding very low level of yield, and so, at the end of the day now, investors are looking for yield. And infrastructure can be an alternative asset class that is becoming more and more interesting for investors that traditionally were investing in more traditional asset classes. You name them, life insurance, pension funds, foundations. All these kinds of long-term investors are looking with greater and increased interest to infrastructure. Banks have understood this. And what they have tried to do is to reshape slightly the way the syndication process was carried out in the past. We have seen that typically a syndication process is a process where one bank shares the commitment to lend with other banks. process where one bank shares the commitment to lend with other banks. The trend now is that banks, mandated lead arrangers, are organizing syndicates where there is a mixed combination of banks and institutional investors. So, the syndicate is becoming a new way to attract investors that are not familiar with this kind of asset class, using the syndication structure where banks typically take care of the due diligence process, the analysis of the deal, the risk analysis and the pricing of the deal. While institutional investors are simply invited as providers of money. So, under the umbrella of the due diligence provided by the MLA and the other banks of the syndicate, they can have access to this interesting asset class, providing money that banks now are no longer able to lend. There are many different models that we can use in order to attract investors. But I would say, at this stage, that the general mood is that we have radically moved from bank to bank syndication, to bank to institutional investors syndication. And I'm sure this will be the leading trend in the future in order to attract more capital to infrastructure.