Ireland Strategic Investment Fund 26 October 2016 The Strand - PowerPoint PPT Presentation

Ireland Strategic Investment Fund 26 October 2016 The Strand Hotel, Limerick

ISIF and Midwest Region • Important for ISIF and stakeholders that investments have impact on a national scale • Pipeline is well spread geographically, a number of potential transactions in the Midwest region • ISIF encourages:  Awareness of the “double bottom line” ISIF mandate  Early engagement from stakeholders, project promoters and companies 2

Eugene O’Callaghan Director, Ireland Strategic Investment Fund T +353 1 238 4066 E eocallaghan@ntma.ie

National Treasury Management Agency (NTMA) The NTMA provides a range of asset and liability management services to the Government of Ireland and is the controller and manager of the Ireland Strategic Investment Fund NTMA National National Funding & Debt Ireland Strategic State Strategic Banking Development Asset Management NewERA Investment Fund Claims Agency Corporation of Finance Agency Management (ISIF) (SCA) Ireland (SBCI)** (FDM) (NDFA) Agency (NAMA)** Sovereign Sources low cost long Manages public private development fund, Manages large real term finance from Co- ordinates State’s Manages the State’s Manages State partnership projects, formerly State pension estate assets and multilateral finance Borrowings in ownership of certain provision of financial fund, mandate now to personal injury and development loans providers and State sovereign bond commercial semi-state advice on large capital focus on strategic property damage acquired from Irish resources and markets firms expenditure by the investment on a claims banks channels this to Irish State commercial basis in SME borrowers Ireland ** Denotes businesses with separate boards staffed by NTMA 4

Transition from NPRF to ISIF is Complete Governance process Legislative process complete complete Team of 35 in place • New NTMA Board appointed • NTMA (Amendment) Act, 2014 • ISIF Investment Committee in commenced in December 2014 place (Feb 2015) High quality pipeline € 2.5 billion developed committed to date Investment Strategy for • Market Engagement Events ISIF published • Water, infrastructure • Advisors/ Intermediaries/ • SME Financial Institution (July 2015) • Venture, technology • 400+ opportunities considered • Real estate, housing • 70 active transactions 5

Fund Size and Structure Total Fund Size € 21.4 bn Discretionary Available for investment in Directed Portfolio accordance with ISIF’s Public policy investments in Portfolio € 13.3 bn objectives AIB and Bank of Ireland € 8.1 bn € 2.5 billion committed Figures in this slide are preliminary and unaudited as at 30 September 2016 6

A Unique and Challenging Mandate Invest on a commercial basis to support economic activity and employment in Ireland 7

A Unique and Challenging Mandate Double Bottom Line Investment Returns Investment Economic Returns Impact Economic Impact 8

High Economic Impact Investments Economic Impact Framework - Key Concepts Additionality Benefits would not have been achieved without the ISIF investment Deadweight Benefits would have been achieved without ISIF investment Displacement Benefits achieved at expense of other domestic players 9

Portfolio Construction: Target Return of 4% Portfolio approach - combination of low risk Average cost & return investments of Government AND higher risk & return debt + ∆ investments RISK Weighted average return of € 8.0bn fund RETURN 1 0

Commercial Investment Objectives Return and Debt and/ Tenor Flexibility Innovative Commerciality or equity Risk adjusted No set regulatory or Seek new ways to expected return Long term horizons return on capital play a role in the requirements market Participate in all levels of capital structure - Third Party investors validate commerciality Equity, Mezzanine, Work with public and Senior Debt, etc No restrictions Ownership / Control private sector parties on tenor not key driver to develop financing No “Soft Money” solutions 1 1

Where do we think we can Invest …with Impact? Real Estate Infrastructure Energy SME Food Agriculture based Direct Private “Big Idea” Venture Other Water Equity 1 2

€ 2.5bn Capital Committed to Ireland € 450m € 361m € 79m Water Infrastructure Energy ISIF Crowding in € Capital ISIF € 2.5bn has unlocked third party € 75 m € 475 m € 355 m capital, total commitment of € 6.4bn Food & Agri Real Estate SME to Ireland € 109 m € 449 m € 92 m Direct Equity Venture Other 1 3

ISIF Transaction Update € 759m € 353m committed in 2015 committed in 2016 with continued strong pipeline with continued strong pipeline € 92m € 15m € 25m € 35m € 15m *Conditional $50m on global € 50m € 54m € 10m fundraising completion € 45m € 19m € 22m € 35m € 45m Funding € 50m € 11m € 325m Round € 100m $30m Funding Round € 150m of commitments to various transactions yet to be announced 1 4

Snapshot of Underlying Investees FY 2015 ISIF supporting 108 Irish-based companies / projects through commercial investments 1 5

A Unique and Challenging Mandate Flexible, long term, sovereign public investment partner 1 6

Flexible, Long-Term, Sovereign Investment Partner  Investment proposals welcome  No specific criteria, just commercial risk adjusted return and economic impact  Early stage proposals, concepts and even ideas welcome - as we can be constructive in shaping the transaction  Strong, supportive partner for corporate Ireland, public entities and international investment funds 1 7

Donal Murphy Head of Infrastructure & Credit Investments T +353 1 238 4934 E donal.murphy@ntma.ie

Infrastructure & Energy Energy Infrastructure Enabling Infrastructure Social Infrastructure Connectivity - Virtual Connectivity Physical Sector • • • Wind, Biomass, • • Enabling Energy Fibre Optic Cable Ports Student Waste to Energy • Infrastructure Projects Airports Accommodation • • • • Sample Enabling Emerging Elderly Care Energy for Data Technologies • Residential Primary Care Centres Projects • Development Centres Broadband • Heat / Energy Efficiency • Flexible • Long Term, • Flexible risk/return • Flexibility of funding • Delivering the What risk/return patient capital metrics solutions “marginal MW” • Scale Up to match • Innovative metrics ISIF • • Long term horizon Flexibility • Long term demographics structures brings… • Accelerate • Certainty of finance investment horizon investment availability 1 9

Connectivity Fund € 22m Pipeline…. € 35m  Ports daa plc Bond Issuance Aqua Comms  ISIF committed € 35m into € 400m  Aqua Comms is a new Irish 12 year bond to help assure based provider of data  Airports success of issue connectivity and bandwidth  Ireland is one of the world’s most infrastructure services  Other Data Connectivity Assets  ISIF’s investment will enable the open economies, making airport connectivity additionally important. Company to execute its transition  Air travel is key to the Irish to an operational phase economy, and daa plc handles c. 91% of all air traffic.  New runway is estimated to cost c. € 320m, the issuance of longer dated debt will underpin the delivery of this infrastructure. 2 0

Renewable Energy  ISIF committed € 35m into € 250m NTR Wind Fund in February 2016  NTR Wind Fund will look to buy, build and operate onshore wind projects in Ireland and UK  To date 6 acquisitions completed with € 100m equity deployed € 35m  Long dated investment which matches the asset life  The IIF is managed by Irish Life Investment Managers together with AMP Capital as the fund's specialist infrastructure investment manager  The IIF is the only infrastructure fund focused entirely on Ireland  The IIF has completed three investments to date – a portfolio of wind farms, a data towers Irish Infrastructure Fund business and the contract to operate the Convention Centre Dublin € 250m  A PPP to develop a thermal waste treatment plant on the Poolbeg peninsula, Dublin.  The project will improve Ireland’s waste disposal performance from both efficiency and environmental aspects by reducing reliance on inefficient landfill.  The project costs € 537m, for which ISIF has committed a € 44m senior debt facility – construction started € 44m Sep 2014, completion planned for Sep 2017  Supporting the construction of a data centre that requires 100% renewable energy from new constructed renewable energy sources within Ireland. € TBA Project eve 2 1