Measuring and evaluating risk is, in practice, the hardest part of any project finance transaction — harder than building the model itself. This training course from the Arab British Fellowship Training Academy puts risk analysis at the centre of the learning experience, then works outward into the full set of tools professionals use to structure, finance, and monitor projects. Delegates move through interactive sessions that connect balance-sheet analysis, valuation, and credit analysis to the realities of financing a single project rather than an entire company.

From there, participants build a project finance model from the ground up, working through its structure, equity cash flow, and free cash flow before tackling common modelling errors, spreadsheet layout conventions, and best-practice habits that reduce error in live models. The course closes on covenants and the practical mitigation of project finance risk, delivered by a team of financial management specialists with international transaction experience.

Who should attend?

• Analysts and managers who need to extend their modelling skills into project finance.
• Senior managers and associate directors involved in structuring or reviewing project finance deals.
• Anyone who needs a working understanding of project finance models and their risk aspects.

How attendees will benefit?

After completion of the course, delegates will understand:

• The transaction form of project finance and an overview of project finance terms.
• Financial statement analysis and evaluation of project finance, including default probability, loss rate, and creditworthiness analysis.
• The basic structure of the project finance model, its use, and interest during construction.
• Market risk, contract risk, and common sources of analytical error in project finance.
• Excel modelling best practices that reduce risk in live models.
• Covenants and the general mechanics of covenants in project finance.

Module 1: Why Risk Analysis Drives Project Finance Decisions

• Sectors and different risks in project financing.
• Identification of risks and general terms in case studies of project finance transactions.
• Market risk and contract risk in project finance.

Module 2: Project Finance Fundamentals and Loan Structures

• Introduction to project finance.
• Overview of project loan terms and comparison of project loans and corporate loans.
• Technical mechanics of project finance.
• General contract design in project finance using case studies.

Module 3: Building and Reading the Project Finance Model

• Purpose of the project financing model and how it works.
• Understanding project financing models and financial statements.
• Reading and interpreting models, and avoiding bad modelling techniques.

Module 4: Debt, Equity and Return Analysis

• Analysis of debt size, debt structure, and profitability in project finance.
• Equity IRR calculation.
• Post-construction technical issues and model-based project finance evaluation.

Module 5: Risk, Creditworthiness and the Sponsor’s Perspective

• Risk analysis in project finance and evaluation of project financial statements.
• Analysis from the sponsor’s perspective.
• Analysis of risk and creditworthiness in project finance, with risk and return case studies.
• Measuring risk and return.

Module 6: Refinancing, Covenants and Risk Mitigation

• Refinancing, covenants, and risk mitigation in project financing.
• Refinancing in project finance.
• Debt service reserve accounting and modelling.
• Covenants in project financing.