The global film business is being revolutionised as billions of dollars of bank finance pours into the sector. Adrian Ward, vice-president of the entertainment, sports and media group, Israel Discount Bank, gives Richard Brass his assessment.
Not every film financier is abandoning the single-picture deal and piling into multi-picture slate deals worth hundreds of millions of dollars. In fact, argues Adrian Ward of Israel Discount Bank, the trend for slate financing has created plenty of demand from producers seeking finance for single projects, and he is happy to oblige.
'I've seen it as a really good opportunity,' he says. 'Other banks have been pulling out of the single-picture business, and still other banks have been pulling out of the business altogether. So there's only a handful of banks now that are willing to do the smaller deals, the one-offs, and there's no shortage of projects.'
An Englishman well entrenched in Los Angeles, Ward has done his time in Europe and sees some of the problems of the German tax funds reflected in the slate financing gold rush. 'There's a history here. The German tax funds were all about slates, and it just doesn't work because there aren't enough individual movies that are successful.
'It's hard enough to find an individual picture that will stand on its own two legs, that makes sense, is budgeted well and has all the right elements to make it a commercially successful or viable project.
'The theory with a lot of this hedge-fund money is if you spread your risk enough over a period of films and a period of time, you'll have enough individual successes to cover any losses on other films.
'But you have to step back a bit. A lot of these hedge funds and the bigger banks don't want to be in the single-picture business because, firstly, they don't know the dynamics or the economics of an individual movie, they don't know the market well enough, they don't know the details of the buyers well enough, so they're looking to spread their risk to minimise that.
'Secondly, they're not in the business of spending all that time and energy to make a $3m or a $5m loan. They're in the business of making $50m or $100m loans, and the only way to do that is over a slate of films.
'It's great for producers, because all of a sudden you can get not one film made, but you can get five made and someone will throw a lot of money at you, but from the money point of view it doesn't stand up most of the time.
'But they'll keep doing it until the people providing the money figure out they're not only not getting their 20%-25% return but they're actually losing money.
'I'm working with producers to structure deals, whether it's for production loans or lines of credit to their production companies or distribution companies or whatever it may be. If a producer comes to me and he's got a film that I like and then he's potentially got others down the road, I'll price it accordingly so he can benefit if he brings me more than just one film. But I don't have to give him all the money up front. I'm only doing it if he's got the movies that justify it. To me, that's the only way it makes sense.'