EBRD signs €50 million risk-sharing facility with Turkish bank TSKB

By Olga Rosca
@olgarosca


  • EBRD extends funded risk-sharing facility of up to €50 million to Turkiye Sinai Kalkinma Bankasi (TSKB)
  • Partnership to help improve access to finance for Turkish firms at critical time
  • Financing to eligible companies to be divided 50:50 between two lenders.

Turkish businesses will have greater access to finance under a new agreement between the EBRD and Turkiye Sinai Kalkinma Bankasi (the Industrial Development Bank of Turkey or TSKB).

The EBRD is providing a risk-sharing facility of €50 million which – together with TSKB resources – will facilitate lending to private industrial companies for a total of €100 million.

Under the agreement signed in Istanbul today by EBRD First Vice President Jurgen Rigterink and Suat İnce, TSKB CEO, the EBRD will share the risk of up to 50 per cent of each individual sub-loan provided to eligible businesses identified jointly by the two lenders.

Clients can use the loans to finance working capital, capital expenditure and refinance existing loans.

The financing comes as bank lending in Turkey remains constrained by economic vulnerabilities.

EBRD First Vice President Jurgen Rigterink welcomed the agreement and said: “The EBRD remains committed to Turkey at this critical time when the capacity of banks to lend is restricted. This is likely to slow down the country’s economic recovery. We expect the Turkish economy to start to pick up by 2020. Innovative tools such as today’s risk-sharing agreement with TSKB will enable local companies not only to continue their business activities but also to grow despite existing constraints.”

Suat İnce, TSKB CEO, said:  “Financial support provided to private sector in Turkey plays an important role in the current rebalancing process. With the risk sharing agreement signed with EBRD, we are pleased to continue supporting the Turkish economy and industry. TSKB is looking forward with confidence to the future of Turkey and we are continuing to create value for our private sector companies with our financing and advisory services.”

The agreement follows a successful utilisation of a similar facility signed in 2015 which demonstrated growing demand from Turkish companies for TSKB loans backed by the EBRD.

Companies that have received financing under the previous agreement include the flour trader Ulusoy Un, the kitchen fittings maker Ukinox, the brass producer Sarbak and flexible packaging producer Besel Basim.

The EBRD is a leading institutional investor in the country and has invested over €11 billion in more than 280 projects in Turkey since 2009. The overwhelming majority of EBRD investments in Turkey are in the private sector.