Just over a year ago, Aviva Investors and a small Switzerland-based investment advisory firm called Hadrian’s Wall Capital announced the first close on an innovative new fund that, it was hoped, could help unlock the potential of Europe’s nascent project finance bond market.
The fund, called the Aviva Investors Hadrian Capital Fund 1 because it was a strategic partnership with the global asset manager, was to invest in long-dated senior infrastructure debt and ultimately provide an alternative to the monoline insurance that was once so important for project bonds.
Before the 2008 financial crisis, monoline guarantees (wraps) were a critical part of the project bond market because the credit enhancement they offered elevated the ratings of the bonds to triple A, enabling institutional investors to get comfortable taking on greenfield construction risk.
Today the monoline industry is a shadow of its former self, having all but collapsed during the financial crisis.
Access this research
Enter your work email address to sign in or check whether your organisation already has access to Euromoney.
