Year: 2022

Winner: Panama Metro Line 3

Panama is one of Latin America’s least populous countries and, geographically, one of its smallest. Yet it is punching well above its weight with some of the biggest and most impressive infrastructure financings of the past year supporting major projects in the nation.
In terms of project financings, few come bigger than the Panama Metro Line 3 — the country’s biggest public infrastructure investment since the $3.1 billion expansion of the Panama Canal, which finally opened its locks in 2016. The Metro’s $2 billion green financing package wins the Infrastructure Financing of the Year for both Central America and Latin America. A South Korean consortium led by Hyundai Engineering and Construction (HDEC) and including Posco Engineering & Construction and Hyundai Engineering won the contract to build Line 3 in February, 2020. Construction got underway 19 months later, after the group lined up a groundbreaking financing package.
A total of 12 financial institutions participated in the revolving facility, which rests on the progressive sale to the government of promissory notes known as CNOs (Certificados de No Objeción). The government is obliged to purchase each CNO at a pre-determined date, eliminating any project-related risk, HDEC said in a written response to questions. Citibank, BNP Paribas, Crédit Agricole, Mizuho, Santander, and SMBC, were mandated lead arrangers while Banco Nacional de Panama, KEB Hana Bank, BBVA and Banistmo were lead
arrangers. South Korean export credit guarantee agencies KEXIM and KSURE acted as anchors for the deal.
The project’s green credentials helped expedite internal approval for the participating banks, enabling HDEC to close financing just in time, the company says.
Line 3 is expected to alleviate traffic between the city and the area west of the canal and thereby cut carbon dioxide emissions.
The line will run westwards from Albrook, where the two existing lines meet, to the town Ciudad del Futuro, 24.5 kilometers away. It is expected to carry an estimated 160,000 people and help drive economic development in the area west of the Panama Canal.
The project was the HDEC’s first deal involving receivables in Latin America but the firm said it was reassured by Panama’s low credit and currency risk.

It hopes Line 3 will serve as a springboard for other infrastructure projects in Latin America,
including public-private partnerships.

“In Korea, there is a lot of liquidity in funds and financial investors wishing to invest in
infrastructure projects, and the Korean government is also active in supporting Korean
companies providing debt and equity participation,” such as in Line 3, the company says.

HPH Consortium for Panama Metro- Hyundai Engineering & Construction KEXIM, K-Sure
Allen & Overy, ARIFA, Banco Nacional de Panama, Banistmo, BBVA, BNP Paribas, Citi,
Credit Agricole, Icaza, González-Ruiz & Alemán, Kim & Chang, K Sure, KEB Hana Bank,
KEXIM, Milbank, Mizuho, Morgan & Morgan, Santander, SMBC

All supporting financial institutions and law firms were transmitted to LatinFinance by the
award category winners. For updates please email