Nippon Life makes $158m loan in overseas infra debut

The Japanese insurer has joined Dai-ichi Life in lending to Turkey’s Ikitelli Integrated Health Campus PPP. 

Nippon Life Insurance Company has made its first overseas project finance loan to a large-scale healthcare PPP in Turkey through its recently formed structured finance department.

Through the unit, Nippon Life committed 17.5 billion yen ($158 million; €134 million) last month to the Ikitelli Integrated Health Campus PPP in Istanbul, Turkey. The 200 billion-yen project is sponsored by Japan’s Sojitz Corporation and Turkish construction company Renaissance Group and plans to provide 2,682 new hospital beds by October 2020. The project reached financial close on 20 July.

Nippon Life said it picked up the loan in syndication, but had been involved with the financing since the beginning. The insurer’s structured finance department, which made the loan, was set up in April to target domestic and international project finance for greater returns. 

It is also part of the insurer’s plan to invest 1.5 trillion yen in “growing fields” in the next four years, including an allocation of 200 billion yen for ESG bonds and similar products. Nippon Life signed the UN’s Principles for Responsible Investment in March and invested $100 million in a social bond issuance by International Finance Corporation, privately placed last week.

Dai-ichi Life, another Japanese insurer, also made a commitment of 10 billion yen to the Turkish healthcare PPP project as its first primary investment in overseas project finance. The company said in April that it would continue to expand sectors and regions for project financing.

Nippon Life and Dai-ichi Life, the two biggest players in the industry, have been investing in infrastructure for a few years. Nippon Life earmarked 40 billion yen for infrastructure equity funds in April 2016, while Dai-ichi Life invested more than 100 billion yen in infrastructure and aircraft finance in 2016, including €30 million for an offshore wind farm in Germany.

Nippon Life and Dai-ichi Life had total assets of approximately 64.8 trillion yen and 35.7 trillion yen respectively, as of 31 March, 2017.