TurSEFF III - Isbank

Location:

Turkey

Project number:

48569

Business sector:

Financial institutions

Notice type:

Private

Environmental category:

FI

Target board date:

04 Oct 2017

Status:

Signed

PSD disclosed:

20 Dec 2017

Translated version of this PSD: Turkish

Project Description

The EBRD has provided USD 55 million financing to Turkish lender Turkiye ii Bankasi A.S. ("Isbank") under the Turkey Sustainable Energy Financing Facility III ("TurSEFF III") for on-lending to eligible private and public sector companies to finance resource efficiency and small scale renewable energy investments. The project is funded through subscription to the senior notes issued under the company's existing Diversified Payment Rights programme. This is the 4th transaction with Isbank under TurSEFF which builds on Isbank's solid track record in implementation of the sustainable energy financing facilities successfully launched by the EBRD in Turkey.

Project Objectives

TurSEFF III builds on success of the first two phases of the framework and aims to (i) further increase financial intermediation for small scale renewable energy investments and a broader range of resource efficiency investments, including energy efficiency, waste minimisation and water savings; (ii) include public sector investments; and (iii) further improve the financial institutions' skills in recognizing and assessing a wider range of sustainable energy and resource efficiency projects.

In addition, TurSEFF III will target the municipal sector in Turkey for the first time through a credit line as well as extending financing to leasing companies which is expected to facilitate financing in areas previously not covered by TurSEFF or any other comparable facility in Turkey.

Transition Impact

Under TurSEFF III, transition impact will stem from: (i) transfer and dispersion of skills by building expertise among both Isbank and sub-borrowers related to sustainable energy and resource efficient technologies and investments; (ii) demonstration of benefits of energy conservation and the promotion of expansion of resource efficiency and renewable energy lending in Turkey; and (iii) setting of standards for corporate governance and business conduct by continuing to mainstream EBRD standards.

Client Information

TURKIYE IS BANKASI AS DPR

Isbank is the largest private bank in Turkey by total assets, deposits and loans. As of September 2017 unconsolidated figures, Isbank had total assets of €83.3 billion and capital of €9.8 billion. Isbank has an unparalleled regional branch network among private banks with 1,370 domestic and foreign branches. Isbank is currently rated BB+ (stable) by Fitch (August 2017), BB (negative) by Standard and Poor's ("S&P", January 2017) and Ba2 (negative) by Moody's (March 2017).

EBRD Finance Summary

EUR 46,574,646.00

USD 55 million

Total Project Cost

EUR 46,574,646.00

USD 55 million

Environmental and Social Summary

Categorised FI (ESP 2014). Isbank will be required to comply with EBRD's Performance Requirements ("PRs") 2, 4 and 9, ensure that sub-loans under TurSEFF III meet with the requirements under PR9 and submit Annual Environmental and Social Reports to the EBRD on the implementation of the Environmental and Social (E&S) requirements and compliance with the PRs. An independent Project Consultant will be in place to ensure that renewable energy and resource efficiency sub-loans comply with the national environmental, health, safety and labour requirements and with the EBRD's E&S eligibility criteria for small hydropower projects and wind power projects.

Technical Cooperation

TurSEFF III will be supported by a technical cooperation programme in the amount of EUR 5.5 million. Funding for the programme will be provided by the EU under the two contribution agreements "Enhancement of Turkish Energy Sector in line with EU Energy Strategies" and "EU Instrument for Pre-Accession Assistance (IPA) 2009 Turkey Private Sector Support Facility".

Company Contact Information

Meryem Onel
Meryem.Onel@isbank.com.tr
90 212 316 28 41
Page 3
90 212 316 08 32
www.isbank.com.tr
Türkiye Is Bankasi A.S International Banking Division Is Kuleleri Kule:1 Kat:25 34330 4.Levent - Istanbul

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