We’re working to increase investment in infrastructure by enhancing the position of infrastructure as an asset class.

Our current work focuses on the regulatory capital treatment of infrastructure investments and how this treatment affects private sector financing of infrastructure. We are consulting with governments, banks, and investors to advance reforms to regulatory capital charges that are prudent for infrastructure as an asset class.

As an independent organisation, free of commercial objectives, the GI Hub is trusted to facilitate collaboration and dialogue between the private and public sectors, and our preliminary consultations show a path and readiness among stakeholders to consider reform.

Learn more about our work in this area below.

Banking regulations play a crucial role in greenfield infrastructure financing

Banks financed 63% of private investment in infrastructure projects in primary markets in 2020. Recent Basel III reforms that curtail this participation can have significant effects, particularly because alternative private sources are not stepping up to finance greenfield infrastructure.

The GI Hub began examining the regulatory capital treatment of infrastructure investments in 2019, as part of our initiative to address barriers to the establishment and advancement of infrastructure as an asset class. Essential to this was an examination of infrastructure investment performance, which we now address in detail in our annual flagship Infrastructure Monitor report. But, we also honed in on how regulatory capital treatments affect private financing of infrastructure. Our preliminary assessment of regulatory capital charges, using aggregated data, suggested that the Basel III regulatory framework requires banks to put aside more capital for infrastructure projects than is warranted by actual infrastructure credit performance. Read more.