EBRD boosts affordable and social housing with Slovenská sporiteľňa bank

The European Bank for Reconstruction and Development (EBRD) is supporting the growth of the Slovak Republic’s capital markets and its transition to a greener, more inclusive economy with a €43 million investment in a €750 million covered bond issuance by Slovenská sporiteľňa bank (SLSP) – the country’s largest ever covered bond issuance.

For every euro invested by the EBRD under this transaction, SLSP will mobilise an additional €0.50 out of its own funds, resulting in a total deployment of €1.50.

SLSP will deploy 120 per cent of the EBRD’s investment in support of green projects, including efficiency measures that reduce energy consumption and CO₂ emissions, as well as highly energy-efficient residential buildings.

With the building sector accounting for 39 per cent of the Slovak Republic’s total energy use, the country will need to see improvements in the energy efficiency of housing if it is to meet climate goals and strengthen energy security.

Alongside that green ambition, this landmark transaction will also deliver strong social impact through the innovative structure of its use of proceeds.

SLSP will channel a further 30 per cent of the EBRD’s investment into affordable and social housing projects that broaden access to housing. This includes financing for municipal and private rental housing, student accommodation, care homes and accessible living upgrades, helping to address financing gaps and supporting underserved groups, including lower-income households, young people, the elderly and people with disabilities. This represents a crucial stepping stone in helping partner banks to improve the affordability of housing in the Slovak Republic.

The Slovak Republic faces one of the most acute housing shortages in the European Union, particularly in major cities such as Bratislava and Košice. Limited supply, high prices and lengthy permit procedures have all contributed to a growing affordability crisis.

SLSP is the country’s largest bank, serving around 2.0 million clients and holding a market share of around 23 per cent in terms of both loans and deposits.
Since the start of its operations in the Slovak Republic, the EBRD has invested more than €3.1 billion in 174 projects across the country.