THE next stage of the financing of the airport project looks set for take-off with the Provisional Airport Authority (PAA) reportedly looking at a record syndication of $11.6 billion. The PAA said it had roughly calculated its borrowing plan for the airport, but refused to comment on whether it was considering a massive $11.6 billion loan syndication, which would be a record for the region. 'We are pleased to say that the PAA has broadly formulated its borrowing plan within the context of the fourth airport-financing proposal,' spokesman Emily Fok said yesterday. The $11.6 billion loan was reported in the latest issue of International Financing Review, which quoted the PAA. 'The deal is expected to mark the largest corporate borrowing ever completed in Asian markets,' it said. It quoted PAA treasurer H Y Wong as saying that if it became cost-effective to re-finance some of the $11.6 billion through bonds, then a rating might be sought and issues launched. Ms Fok said the PAA had kept in touch with key lenders and capital market participants, but added: 'We do not wish to speculate on the instruments likely to be used for airport financing at this stage.' Wardley Capital deputy managing director Andrew Ferguson declined to comment on whether Wardley had discussed such a deal with the PAA. The published report said the PAA had to put in place a permanent credit structure before it could go to banks for finance. 'Once the green light [from Britain and China] is given, the PAA and the MTRC will between them raise around $23.7 billion in the debt markets.' One banker who had been talking to the authority confirmed that the PAA was looking at the loan market for most of the cash needed. 'The last time I met the PAA, it said it planned to raise the bulk of the financing through a syndication,' he said. Another banker had misgivings about whether the market was ready for a deal of that size. 'When you're talking about the size of that borrowing, I hope it's going to be done on a phase-by-phase basis rather than hitting the market in one go,' he said. He said banks were gearing up for the airport-financing onslaught. 'Look at the banks who are not afraid to keep lending - Hang Seng Bank, Hongkong Bank and the Bank of East Asia.' Hongkong Bank has set up a $3.2 billion floating-rate certificate of deposit (FRCD) and earlier this month announced an $8 billion certificate of deposit issuance programme, while subsidiary Hang Seng Bank raised $2.2 billion through an FRCD and Bank of East Asia has done a $1 billion fixed-rate CD. The banker said: 'People say this issuance is due to the new guidelines of the Hong Kong Monetary Authority [on banks matching assets and liabilities]. I think it's more to do with the banks concerned that there's going to be a shortage of Hong Kong dollar funding,' he said. 'I think it's more to do with concern that liquidity might dry up.' In the first nine months of 1994, banks raised about $16 billion in floating-rate issues, he said. Fixed-rate adds another $13 billion.