01 Performance INVESTMENTS BY FINANCE TYPE

CEFC ANNUAL REPORT / 2014–15

INVESTMENTS BY FINANCE TYPE

The CEFC’s portfolio remains diversified by finance type, with approximately 70 per cent of the portfolio in senior debt investments and 30 per cent in equity or hybrid investments.

Debt investments are diversified across corporate loans ($407 million or 41 per cent), project finance ($320 million or 32 per cent) and co-financing programs ($272 million or 27 per cent).

In 2014–15, the following factors led to changes in the portfolio finance type mix:

  • An increase in equity exposure through the $125 million investment into the EG Group High Income Sustainable Office Trust
  • A decrease in project finance investments of $67 million due to committed funds not being required
  • A $50 million increase in co-finance programs (Firstmac), offset by a $120 million decrease in co-finance programs already in the portfolio caused by the expiry of funding agreements
  • A $300 million increase in corporate loans, largely driven by:

- A $120 million investment into the NAB Energy Efficient Bonus program
- A $100 million into the Origin Solar as a Service program
- A $75 million investment in the NAB Climate Bond.


Figure 16: Finance types

Project finance

Typically larger-scale investments secured against a single asset, such as a utility-scale generator, which is held by special purpose entity that exists solely to house this single generating asset or project

Corporate loans

Typically a loan to a company which may be engaged in multiple activities for its smaller-scale projects, or a bundle of projects, secured against the corporate entity

Co-financing programs

A demand aggregation program, typically a loan based arrangement administered by a co-financing bank or utility involving ‘sell through’ CEFC finance to a range of customers, particularly small and mid-sized business, local government and not-for-profits — extending the CEFC’s reach and harnessing the co-financier’s networks and sales and service footprint

Equity

Equity is a financial instrument where the CEFC typically takes an ownership position in an asset through a unit holding in a fund or other pooled investment vehicle. Returns are based on earnings and capital appreciation, instead of interest payments.


Figure 17: CEFC investments by finance type – debt and equity

At 30 June 2015 ($m and %)


Figure 18: CEFC investments  by finance type – by subcategory

At 30 June 2015 ($m)