Project description
and objectives:
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The proposed project is a multi-currency facility to BT for up to €10 million equivalent in three tranches to be on-lent by BT to private individuals in Romania as mortgage loans. The proceeds of the credit line will be used by BT to provide long-term financing to individuals for buying/constructing and/or repairing real estate properties (houses, flats and the like). The sub-loans would be denominated in various currencies depending on customer demand.
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Transition impact:
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Transition impact potential derives from the demonstration effect associated with supporting the growth of mortgage lending which is relatively new but currently very fast growing in Romania.
Development of a primary mortgage market would also contribute to the development of capital markets by providing possible long-term tradable securities in the future. The proposed facility will require the standardisation of mortgage contracts with sub-borrowers as a pre requisite for the future development of a secondary market. Supporting the growth of BT and the diversification of its funding base will strengthen the banking sector by providing much needed long-term financing for individuals, thus increasing competition.
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The client:
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BT is a private Romanian bank, with around 2% market share of total banking assets at end-2002, total assets of some US$ 255 million, total equity of some US$ 46 million and net profit of some US$ 7.2 million (IAS).
BT's total assets further increased to US$ 294 million (unaudited) as of end-June 2003 and its total equity to US$ 52 million as of the same date. BT is one of the most dynamic private banks in Romania offering a wide rage of modern banking services to its clients. Its large branch network of 62 branches and sub-branches all over the country made it possible to strategically focus on the SME sector. BT's gained experience in mortgage lending will be a significant benefit for its retail clients. Amongst the shareholders of BT, the European Bank for Reconstruction and Development currently owns 15.0% and a group of smaller Romanian and foreign shareholders with various shareholdings up to 5% each. Two Romanian private investment funds (SIF Oltenia and Banat-Crisana, respectively) each hold less than 5% of BT.
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EBRD finance:
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A multi-currency loan for up to €10 million extended by the Bank to BT.
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Total project cost:
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€10 million
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Environmental impact:
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The environmental risks associated with the operation and the potential portfolio are low. BT is already implementing the EBRD's environmental policy for local banks. BT will need to ensure that property survey to be conducted for each loan as part of its due diligence. The survey should include consideration of potential site contamination, use/presence of hazardous materials in construction, risk of flooding or seismic activity and compliance with the applicable national environmental, health and safety standards and regulations.
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Technical
cooperation:
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BT benefited from technical assistance granted by the EBRD and funded by EU/Phare under the SME Facilities I & II which was under implementation for the last 3 years by Shorebank Advisory Services (SAS), USA.
No technical assistance is envisaged for the proposed project.
For consultant opportunities for projects financed by technical cooperation
funds, visit procurement
of consultants.
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Company contact:
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Ms. Mihaela Nadasan
Head of International Relations Department
Banca Transilvania SA
Cluj-Napoca, Romania
Phone: +40 264 407 150
Fax: +40 264 407 179
E-mail: Mihaela.Nadasan@btrl.ro
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EBRD contact:
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Alexandru Tanase, Operation Leader: tanasea@ebrd.com
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Business opportunities:
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For business opportunities or procurement, contact the client company.
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General enquiries:
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EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168; Fax: +44 20 7338 7380
Email: projectenquiries@ebrd.com
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