The European Bank for Reconstruction and Development ("EBRD" or the "Bank") is committed to establishing a regional initiative on non-performing loan resolution and debt restructuring in the EBRD region (the "Project" or the "NPL initiative").
Six years after the financial crisis, high and still rising non-performing loans "NPLs") remain a major problem in the financial sectors of many EBRD countries of operation. NPLs depress credit activity, growth and ultimately job creation, perpetuating the private-sector debt problem. Establishing the institutions and processes for the resolution of non-performing loans and the parallel process of financial restructuring in enterprises is therefore a central objective under the EBRD’s transition mandate. This is reflected in the Bank's strategy for financial institutions, and in the strategies for the countries which will initially be targeted under this initiative: Croatia, Hungary, Serbia, Slovenia and Montenegro.
The framework of the Vienna Initiative will allow the Project to utilise a highly successful private-public coordination platform, which benefits from established partnerships with the International Monetary Fund ("IMF"), the European Investment Bank ("EIB"), the World Bank, and the European Commission as participating international institutions, with regulators of the home and host countries, and with the commercial banks. In addition, the NPL initiative has begun to widen this network to investors in the distressed asset space, advisory and law firms.
The Project will also benefit from the analysis undertaken in the context of the Vienna Initiative that culminated in an extensive report on this topic in 2012.
Regulatory changes in Europe, and the persistent weight of delinquent assets on bank balance sheets have now given new impetus to this initiative.
In 2014 public and private sector stakeholders within the Vienna Initiative decided to step up their engagement and recommended that specific obstacles within key countries should be addressed. In the second stage of the Vienna Initiative NPL work, more concrete reforms in legal frameworks and workout institutions will be targeted and support, training and other technical assistance will be made available to upgrade capacity in the target countries.
To this end, the initiative will focus on the following three principal dimensions:
- In-country dialogue. Analysis of obstacles to NPL resolution and financial restructuring of debt-distressed enterprises conducted through broad public-private working groups within target countries, and specific action plans for overcoming such obstacles. Five countries have initially committed to participate in the initiative, and each will be supported by one international institution: Serbia and Albania by the IMF, Croatia and Montenegro by the World Bank, and Hungary by the EBRD.
- Knowledge sharing. A small central group will compile and disseminate documentation on best practice and experience in Europe and its periphery, as well as potential lessons from other emerging markets.
- Local capacity-building. Further technical assistance by the international institutions will support public-sector counterparts in the target countries; local bank and restructuring professionals will benefit from training seminars. In parallel, a group of six commercial banks are committed to strengthening restructuring principles implemented by their subsidiaries within the region.
A small central group of professionals (the "Secretariat"), will support all country action plans, knowledge dissemination, and capacity building activities. This procurement notice relates to the services to be provided by the Adviser (the "assignment")
The EBRD is seeking an Adviser. The Adviser will be required to be available on a part-time basis. There is flexibility on the location at which the services are performed, although the Adviser will be expected to be available on a regular basis for meetings with the Senior Adviser and other EBRD staff working on the NPL Initiative in London. He/she will regularly interact with EBRD staff working on the Project and work closely with the Senior Adviser, who will manage all central functions of the Initiative. Reporting will be to the EBRD Operation Leader responsible for the NPL Initiative. There will also be part-time support from an analyst within EBRD, and some assistance with administrative functions will be given.
The Adviser will be responsible for compiling between 6 and 10 short notes which document best practice in a number of areas pertaining to NPL resolution and debt restructuring, in all cases with reference to the specific situation in emerging Europe. Topics and delivery schedules for these notes will be set by the Senior Adviser in coordination with the Operation Leader. Among other things, these notes could cover:
o Provisioning policy and other issues around prudential regulation
o Convergence in regulatory and supervision standards between SSM countries and other European Union ("EU") and non-EU countries
o Tax treatment of restructuring operations, including application of DG-Comp standards
o Appropriate elements of insolvency law
o Out of court restructuring, and adapting international restructuring principles (eg INSOL) within the context of emerging Europe
o Role of asset management companies in NPL resolution
o Valuation standards for distressed assets in illiquid markets.
In addition, the Adviser will be expected to present this analysis within individual target countries, either in the public-private working groups, or directly vis-à-vis the key officials supporting this initiative. The Adviser will liaise with the authorities of countries participating in the initiative with a view to advocating reform steps that facilitate NPL resolution and corporate restructuring, and elevating the NPL agenda will all local public sector stakeholders.
To achieve these objectives, the Adviser will be required to maintain a network of contacts among regulators and private market participants, both within the euro area and outside it, that can promote experience and knowledge sharing.
This initiative will be a highly visible work stream for the Vienna Initiative and for the EBRD. Both the Senior Adviser and the Adviser will regularly interact with EBRD's economists, with EBRD Banking Department professionals and other functional departments, and with a wide range of official sector stakeholders and market participants.
Assignment Start Date and Duration: The assignment is expectecd to start around August or September 2015 and last for 18 months
Maximum Cost Estimate: To be negotiated
VAT: The Consultant must determine whether any indirect taxes/VAT are chargeable on the proposed services and state the basis for such determination in their response to the Notification.
Funding Source: The expected source of funding for the assignment is EBRD's Shareholder Special Fund
Eligibility: There are no eligibility restrictions
Consultant Profile: Individual services will be sought. Firms may submit CVs (one per submission) but the evaluation will be based on the CVs and not on the firm.
Individuals wishing to be selected should have the following qualifications and experience:
- Ideally 5 years or more experience in a restructuring environment within a commercial bank, advisory or law firm, or an international institution
- Expertise with bank regulation and supervisory practices with regard to asset classification and provisioning in the European Union context
- Expertise with regulatory standards and tax treatment of corporate debt restructuring, ideally from an international organisation or advisory firm
- Experience in translating regulatory recommendations into straightforward policy recommendations that can be advocated at a senior policy level - ideally with a demonstrable track record of publications in this area
- Strong communication and interpersonal skills
- Ability to maintain professional networks
Submission Requirements: In order to determine the capability and experience of candidates seeking to be selected for this assignment, the information to be submitted and sent to the contact person below should include the following documents:
1. Cover Letter (maximum 2 pages) summarising how the candidate satisfies the requirements as defined above
2. CV which should be detailed and include a full description of roles and responsibilities carried out
3. Completed consultant declaration form and contact sheet, the tem template for which is available from the following web-link: http://www.ebrd.com/pages/workingwithus/procurement/notices/csu/contact_sheet.doc
Up to 6 shortlisted candidates will be invited to interview as part of the evaluation process.
EBRD's Contact Person:
European Bank for Reconstruction and Development
Tel: + 44 20 7338 6363
Fax: +44 20 7338 7451
The complete expression of interest (including CVs, Consultant Declaration and Contact Sheet) should be submitted, in English electronically through e-Selection, to reach the Bank not later than the closing date.
1. The selection will normally be made from responses to this notification only. The highest-ranked consultant will be selected from a shortlist and be invited to negotiate the contract, subject to availability of funding.
2. Shortlisting criteria are as follows:
a) Experience in a restructuring environment within a commercial bank, advisory or law firm, or an intrenational institution (25%)
b) Expertise with bank regulation and supervisory practices with regard to asset classification and provisioning in the European Union context (20%)
c) Expertise with regulatory standards and tax treatment of corporate debt restructuring, ideally from an international organisation or advisory firm (20%)
d) Experience of translating regulatory recommendations into straightforward policy recommendations that can be advocated at a senior policy level - ideally with a demonstrable track record of publications in this area (15%)
e) Personal qualities to be assessed at interview (20%)