Standard Chartered and the Dutch asset manager PGGM have arranged a new US$2.5bn innovative risk sharing agreement involving trade finance assets.
The transaction has been been named Shangren and under the terms of the deal PGGM provides credit protection at an equity and mezzanine level on a diversified portfolio of trade finance credit exposures.
The US$2.5bn portfolio comprises 1,600 customers in 30 countries across Standard Chartered’s core markets. All the assets are sourced from the bank’s balance sheet, and according the an official statement, they have all gone through a “rigorous internal credit process”.
StanChart co-invests with PGGM in the equity portion of the deal, and retains the full amount of the senior tranche.
“Shangren offers us a unique opportunity to invest in a new asset class that is difficult to find in the public market,” comments Raymond van Wersch, senior portfolio manager structured credit at PGGM.
Paul Hare, managing director, portfolio management, at Standard Chartered adds: “We are delighted to have closed this significant balance sheet transaction with PGGM. It is particularly satisfying given the broader market context. PGGM is an experienced investor with rigorous standards. We see Shangren as strong endorsement of our credit discipline and clear strategic focus in our core markets.”
Reader Comments