Structured Financing

Professor: Christophe Chouard, Associate Professor, Panthéon-Assas University, Aldis Capital Consultant

Objectives: The aim of the course is to understand 1) how the constraints of the banks explains why they may be reluctant to lend to firms, 2) to discover the solutions brought by the structured financings to release these constraints, and 3) to understand the different types of structured financing.

Outline:

1. The functioning of financial markets

• The role of finance and the different actors
• Equity or debt financing
• The role of financial markets

2. Banks' constraints: Basel 3 in a nutshell

• Regulatory capital
• The leverage
• Liquidity: flow constraint
• Liquidity: stress of outstandings

3. LBOs

• Definition and functioning
• Financial leverage
• Contributions and risks
• Where does value creation really come from?

4. Project and infrastructure financing

• Mounting
• Players
• Legal considerations
• Financial considerations
• Solutions and risks

The financing of movable assets

• The montages
• Financial lease, operational lease, tax lease
• Solutions and risks

6. Securitization

• Mounting
• Solutions and risks
• Towards new simple, transparent and standardized securitisations

Grading: A final exam at the end of the semester.

Bibliography:

• Charles-Henri Larreur – Financements Structurés Innovations et Révolutions Financières – Ellipses.