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Financing completed for Taiwan’s largest wind farm - Industry roundup: 6 November

Deutsche Bank provides financing for Taiwan’s largest wind farm

Deutsche Bank has completed a bespoke deal-contingent interest rate hedge and tailored financing for Hai Long, Taiwan’s largest offshore wind project to date. Once completed, the wind farm will supply the equivalent of the electricity consumed by more than 1 million households in Taiwan (roughly 10% of its population) annually. Hai Long is expected to play an essential role in helping Taiwan achieve its goal of constructing 5.7 GW of offshore wind farms by 2025, and net-zero greenhouse gas emissions by 2050. 

Hai Long is a 1.0 gigawatt (GW) offshore wind project developed and owned by Northland Power Inc. (Canada) and Mitsui & Co (Japan). This transaction represents the largest offshore wind project financing in the region. The total project cost is forecasted to be approximately US$6.5bn, of which approximately US$3.6bn is being raised through project financing with support from export credit agencies (ECAs) from six different countries and many international and local financial institutions.

The project is Northland’s first offshore wind project in Asia and the fifth in its offshore wind portfolio. Deutsche Bank previously financed the construction of Northland’s first-ever offshore wind farm in The Netherlands. Upon the project’s financial closing, Gentari International Renewables Pte Ltd, a wholly-owned subsidiary of Petronas, will acquire a 29.4% indirect equity interest in Hai Long. Northland will own 30.6% and continue leading in construction and operation.

“Our tailored project finance and risk management solutions for our clients have been instrumental in the buildout of Taiwan’s renewable energy sector,” said Cynthia Chan, Deutsche Bank Chief Executive Officer for Taiwan. “To date, we have helped finance nearly 3 GW of wind power capacity for Taiwan across four large-scale transactions. Each transaction is unique and highly complex, involving multiple jurisdictions and a wide range of product requirements.”


Payments Canada selects Nexi to enhance critical resilience of RTGS

Payments Canada, the organisation responsible for Canada’s payment clearing and settlement infrastructure, has selected Nexi to enhance further the resilience of Lynx, Canada’s high-value payment system. Based on the real-time gross settlement (RTGS) model, wire payments cleared and settled using Lynx are fast, irrevocable, and made with real-time settlement finality.

Payments Canada is now using Nexi’s RTGS Extreme Contingency Solution (RECS), specifically designed to ensure the reliability and resilience of the Lynx system. The technology should help the organisation continue to operate in the event of a disruption or sudden disaster.

The Nexi RECS technology provides the organisation with an additional site that can be activated in an emergency, such as a malicious attack, network failure, or natural or accidental disaster. If such an event were to occur, the technology would allow the organisation to continue to provide a core service that underpins the Canadian economy until regular business is restored.

“The safety and soundness of Canada's payment systems is Payments Canada’s top priority,” said Shawn Van Raay, Chief Information Officer at Payments Canada. “This work, completed in partnership with our Lynx participants, the Bank of Canada and our technology partners IBM and Nexi, provides a supplementary layer of resilience to support the continuity of our operations in a safe and secure manner.”


Indonesia and Singapore further extend bilateral financial arrangement

Bank Indonesia (BI) and the Monetary Authority of Singapore (MAS) have announced extending their bilateral financial arrangement by one year, to 2 November 2024. This arrangement continues to reinforce the ongoing financial cooperation in preserving monetary and financial stability in both countries amid global macroeconomic uncertainties. The arrangement comprises two agreements:  

  1. A local currency bilateral swap agreement allows for the exchange of local currencies between the two central banks of up to SGD9.5bn or IDR100 trillion. 
  2. A bilateral repo agreement of US$3bn allows for repurchase transactions between the two central banks to obtain US dollar cash using G3 government bonds (US treasuries, Japanese government bonds and German bunds) as collateral.

The bilateral financial arrangement, endorsed by Indonesia President Joko Widodo and Singapore Prime Minister Lee Hsien Loong, was established between BI and MAS in November 2018 following the Indonesia-Singapore Leaders’ Retreat. The arrangement has been extended annually since.


NAB introduces fee-free international business payments 

NAB is removing the AU$10 transaction fee for business customers making international payments with a currency conversion via NAB Connect and Direct Link.

The bank says the charge removal may benefit more than 15,000 business customers making cross-border payments via NAB’s online banking platforms every month. This initiative builds on the bank’s decision to remove the international money transfer fees for individual customers in 2022.

“Our business customers initiate thousands of international payments every week and the charges can quickly add up,” said Shane Conway, NAB Executive Transaction Banking & Enterprise Payments. “We’re removing our transaction fee to help customers move their money in other currencies without the extra cost. Around 75% of customers making international transfers using NAB Connect and Direct Link are small to medium businesses and with economic conditions tightening in many sectors we know every dollar counts.”


National Bank of Georgia selects Ripple for Digital Lari pilot project

The National Bank of Georgia (NBG) has chosen Ripple as the official technology partner for its Digital Lari (GEL) pilot project. The pilot will experiment with Ripple’s CBDC technology and evaluate the practical use cases to gauge potential benefits for the public sector, businesses and retail users. 

In its announcement, NBG explained that it chose Ripple to support its national digital currency pilot due to its “deep understanding of the project’s purposes and use cases, as well as a full commitment to the project’s success, sustainable business continuity, clear project development roadmap, and gradual deployment approach to use-cases.” 

Additionally, NBG highlighted Ripple’s “experience in conducting real-life pilot project deployments, ranging from primary CBDC digital infrastructure to smart contracts and tokenisation.”

The Ripple CBDC Platform is powered by the XRP Ledger (XRPL), an open-source blockchain. Ripple was chosen as NBG’s single technology partner during a selection process involving nine shortlisted companies assessed on their capabilities to support the pilot. Now that the selection phase is complete, NBG will move to the pilot stage to test the Ripple CBDC platform in a live environment to enable them to evaluate select use cases.


US truck freight spending drops for fifth consecutive quarter

During the third quarter, the amount spent to ship goods via truck freight was down 12.5% compared to a year prior, while the volume of shipments was off 9.7%, according to the U.S. Bank Freight Payment Index. Spending fell 4.2%, and shipments declined 3.4% from the second quarter to the third quarter of 2023. This marks the fifth consecutive quarter that both truck freight spending and volume have declined.

“This quarter’s Freight Payment Index results confirm that we are in a very challenging environment for motor carriers,” said Bob Costello, senior vice president and chief economist at the American Trucking Associations. Costello pointed to a variety of factors that are impacting the truck freight economy, including retailer inventory reduction, decreased homebuilding and consumers preferring to spend on experiences over goods.

The pullback in shipments was greatest in the West region, where volume was down 22.9% compared with the third quarter of 2022. Spending, meanwhile, contracted the greatest in the Midwest region, where it’s down more 17.9% year-over-year. Even the Southwest region – which has stood out in recent quarters for spending increases – saw a drop of 4.8% compared to the previous quarter.

“Across the board our data is showing a continued decline of the truck freight market, especially compared to last year’s strong performance,” said Bobby Holland, director of freight business analytics, U.S. Bank. “We’ll be watching closely in upcoming quarters for signals that the market has reached a bottom in terms of volume and spending.”


Nuvei and American Express to facilitate seamless account-to-account payments for merchants

American Express has selected Nuvei Corporation as its first acquirer authorised to promote and sell the card company’s Pay with Bank transfer (PwBt) open banking-enabled payment method.

The payment method is designed to enable consumers to complete transactions seamlessly from their bank accounts without having to enter card details or complete additional authentication checks. For merchants, PwBt aims to deliver a frictionless payment where funds are reconciled instantly, with attractive processing fees. Nuvei will be promoting PwBt to both existing and prospective UK merchants, supporting them with the integration of the open banking payment method into their e-commerce platforms.

In the UK, more than seven million consumers are making payments directly from their bank accounts. Companies in the travel and utility sectors have been early adopters, with the security benefits of PwBt making it an option for high-value, one-off payments, such as holidays, and seamless and instant bill payments.

All Nuvei partners that sell to consumers in the UK can now instantly integrate PwBt. While the technology is provided by American Express, it is open to everyone with a UK bank account.


Standard Chartered completes sale of global aviation finance leasing business to AviLease

Following the announcement in August 2023 of the sale of Standard Chartered’s global aviation finance leasing business to Aircraft Leasing Company (AviLease), the bank has now confirmed the sale has closed.

AviLease has acquired the business for cash consideration of US$0.7bn and has funded the repayment of approximately US$2.9bn of net intra-group financing from the bank.

The bank will benefit from an increase in common equity tier 1 capital ratio of around 19 basis points, which will be included in its year-end capital position. 


Westpac to acquire health payments provider HealthPoint

Westpac has agreed to acquire the electronic health claims processing business HealthPoint. The business provides real-time private health claiming services to businesses at the point of sale, connecting healthcare providers, consumers and financial institutions.

The acquisition allows Westpac to expand its payments offering to support our small business and commercial customers in healthcare – such as GPs, physios and other specialists – to provide on-the-spot e-health claiming for their patients.

HealthPoint will be established as a subsidiary of Westpac Banking Corporation, which would continue to provide services to HealthPoint’s existing partners. The acquisition is subject to approval by the Australian Competition and Consumer Commission and other conditions precedent.


1PointFive and TD Bank announce purchase of direct air capture carbon removal credits

1PointFive, a carbon capture, utilisation and sequestration company, and TD Bank Group have announced a purchase of carbon dioxide removal (CDR) credits from STRATOS – 1PointFive's first Direct Air Capture (DAC) plant currently under construction in Texas.

Under the terms of the agreement, and subject to STRATOS becoming operational, TD Securities has agreed to purchase 27,500 metric tons of DAC CDR credits over four years.

STRATOS has been designed to be the first large-scale commercial deployment of DAC technology globally, with the potential to capture and remove up to 500,000 metric tons of CO2 from the atmosphere each year for secure and long-term storage in geologic formations. 1PointFive's CDR credits are expected to provide a practical and high-integrity solution for organizations to address their emissions.

With this transaction, TD Securities expects to add to its portfolio of voluntary carbon offsets, as it continues to build out its carbon advisory and trading capabilities in the voluntary and compliance carbon markets. These capabilities complement TD Securities' broader ESG Solutions platform, focusing on providing clients with short, medium and long-term solutions as they transition to a lower carbon economy. In addition, TD intends to use a portion of the credits from this transaction to offset its own operational emissions.


Visa learning program to diversify and upskill payments talent

Visa has announced the launch of the Visa Payments Learning Program designed to upskill employees, students, clients and military talent through training courses and certifications to support a sustainable and diverse talent pipeline. The initial focus of this program is centred around payments cybersecurity, created in response to the White House National Cybersecurity Strategy Implementation Plan that calls on business to heighten pathways for individuals to get into cybersecurity as the call for skilled cyber professionals continues to increase.

In March 2023 alone, 41.9 million data records were compromised by cyberattacks worldwide - a 951% increase since March 2021. This has created a demand for cybersecurity talent across all industries, but demand outpaces supply, with global cybersecurity job vacancies growing by 350%, with 3.5 million unfilled roles in 2023. Overcoming this shortage is critical for any organisation, but it is particularly important in the payments industry to protect sensitive data, prevent potential losses, comply with regulations, and maintain customer trust.

Currently available in the US with plans to expand globally, the Visa Payments Learning Program is comprised of several cross-functional programs to include Visa University, Visa’s Apprenticeship Program, and Visa’s Military Talent Program to allow for diverse avenues of upskilling and creating new entry pathways for untapped communities.

Through Visa’s Apprenticeship Program, an initial cohort received 16 weeks of specialist training, followed by a one-year apprenticeship, and will participate in the Visa’s Payments Cybersecurity Introductory Course. This apprenticeship provides diverse talent on-the-job training to build technical and business skills needed to succeed as cyber professionals.

Visa’s Military Talent Program actively recruits and hires military veterans, reservists, and military spouses to provide them with training and reskilling. By creating a pipeline of military-affiliated talent, Visa has an opportunity to provide training in areas such as payments cybersecurity that builds on their existing skillsets and rich diversity of experience.

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