RLF - BT SP loan

Location:

Romania

Project number:

53771

Business sector:

Financial institutions

Notice type:

Private

Environmental category:

FI

Approval date:

15 Jul 2022

Status:

Disbursing

PSD disclosed:

15 Jul 2022

As per section 1.4.2 (iii) of the Directive on Access to Information: "For Projects approved by Bank management where the Board of Directors has delegated the approval authority, the PSD shall be disclosed at the start of the relevant no-objection notification period to a member country of the Bank in accordance with Article 13 (iii) of the Agreement Establishing the EBRD."

Project Description

Provision of EUR 25 million senior preferred ("SP") unsecured loan to Banca Transilvania SA, the largest bank in Romania.

Project Objectives

The proposed Project aims to support the resilience of Banca Transilvania, the largest systemic bank in Romania, in a market environment that has become even more challenging given the recent market disruption arising from the ongoing war on Ukraine, the inflationary pressures and remaining risks from COVID-19.  Through this Project, BT will focus on on-lending to businesses in Romania, particularly MSMEs, which have been directly and indirectly impacted by the ongoing war and its economic spill-over effects on the regional economies. 

Transition Impact

ETI score: 65

The expected transition impact of the Project stems from its contribution to the Resilient and Inclusive transition qualities. The operation will support the Resilient transition quality by supporting BT in meeting its respective regulatory requirements towards loss absorbing funding base and also support a systemic bank's resilience to market and regulatory shocks, thereby increasing its long-term sustainability. The transaction will contribute to the Inclusive quality by facilitating the financing of businesses in Romania, particularly MSMEs, which have been directly and indirectly impacted by the ongoing war and its economic spill-over effects on the regional economies. 

Client Information

BANCA TRANSILVANIA SA

Banca Transilvania S.A. is currently the largest bank in Romania with ~19.5% market share in terms of total assets as of YE21. As of 31 March 2022, apart from EBRD's holding of 6.88%, foreign entities and individuals held ca. 29.8% of BT's share capital, while 63.3% was held by domestic private and institutional investors. BT is rated by Fitch, BB+ (stable) as of 22/12/2021.

 

EBRD Finance Summary

EUR 25,000,000.00

Bail-in-able bilateral senior unsecured loan

Total Project Cost

EUR 100,000,000.00

Total bail-in-able funding for 2022 to be sourced by EBRD and private investors. 

Additionality

Financing structure and risk mitigation - Given the insufficient market capacity and lower liquidity of the local capital market, the project wil be closing the funding gap and ensuring BT raises enough bail-in-able funding to meet its regulatory requirements.

Environmental and Social Summary

Categorised FI (ESP 2019). Banca Transilvania (BT) is an existing client and is in compliance with the EBRD's Performance Requirements (PRs) 2, 4 & 9 under existing exposures. The bank  has developed appropriate capacity to manage environmental and social risks. BT is satisfactorily managing E&S risks within the bank's existing portfolio, which has an medium-high E&S risk profile, by applying the EBRD's Environmental and Social Risk Management Procedures across its portfolio and has submitted satisfactory Annual Environmental and Social Reports (AESRs) to the Bank. For this transaction BT will be required to continue to comply with PRs 2, 4 & 9, adhere to the EBRD's E&S requirements and submit AESRs to the Bank.  The proposed transaction will require BT to apply the E&S Exclusion List which was amended for the 2019 policy, and also apply the Referral List as per PR9.

Technical Cooperation and Grant Financing

None

Company Contact Information

Stefania Tent
stefania.tent@btrl.ro
+40(0)264 407150
+40(0)264 407179
https://www.bancatransilvania.ro
400027 Cluj Napoca, 8 G. Baritiu Str.

PSD last updated

15 Jul 2022

Understanding Transition

Further information regarding the EBRD’s approach to measuring transition impact is available here.

Business opportunities

For business opportunities or procurement, contact the client company.

For business opportunities with EBRD (not related to procurement) contact:

Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com

For state-sector projects, visit EBRD Procurement:

Tel: +44 20 7338 6794
Email: procurement@ebrd.com

General enquiries

Specific enquiries can be made using the EBRD Enquiries form.

Environmental and Social Policy (ESP)

The ESP and the associated Performance Requirements (PRs) set out the ways in which the EBRD implements its commitment to promoting “environmentally sound and sustainable development”.  The ESP and the PRs include specific provisions for clients to comply with the applicable requirements of national laws on public information and consultation as well as to establish a grievance mechanism to receive and facilitate resolution of stakeholders’ concerns and grievances, in particular, about environmental and social performance of the client and the project. Proportionate to the nature and scale of a project’s environmental and social risks and impacts, the EBRD additionally requires its clients to disclose information, as appropriate, about the risks and impacts arising from projects or to undertake meaningful consultation with stakeholders and consider and respond to their feedback.

More information on the EBRD’s practices in this regard is set out in the ESP.

Integrity and Compliance

The EBRD's Office of the Chief Compliance Officer (OCCO) promotes good governance and ensures that the highest standards of integrity are applied to all activities of the Bank in accordance with international best practice. Integrity due diligence is conducted on all Bank clients to ensure that projects do not present unacceptable integrity or reputational risks to the Bank. The Bank believes that identifying and resolving issues at the project assessment approval stages is the most effective means of ensuring the integrity of Bank transactions. OCCO plays a key role in these protective efforts, and also helps to monitor integrity risks in projects post-investment.

OCCO is also responsible for investigating allegations of fraud, corruption and misconduct in EBRD-financed projects. Anyone, both within or outside the Bank, who suspects fraud or corruption should submit a written report to the Chief Compliance Officer by email to compliance@ebrd.com. All matters reported will be handled by OCCO for follow-up. All reports, including anonymous ones, will be reviewed. Reports can be made in any language of the Bank or of the Bank's countries of operation. The information provided must be made in good faith.

Access to Information Policy (AIP)

The AIP sets out how the EBRD discloses information and consults with its stakeholders so as to promote better awareness and understanding of its strategies, policies and operations following its entry into force on 1 January 2020. Please visit the Access to Information Policy page to find out what information is available from the EBRD website.

Specific requests for information can be made using the EBRD Enquiries form.

Independent Project Accountability Mechanism (IPAM)

If efforts to address environmental, social or public disclosure concerns with the Client or the Bank are unsuccessful (e.g. through the Client’s Project-level grievance mechanism or through direct engagement with Bank management), individuals and organisations may seek to address their concerns through the EBRD’s Independent Project Accountability Mechanism (IPAM).

IPAM independently reviews Project issues that are believed to have caused (or to be likely to cause) harm. The purpose of the Mechanism is: to support dialogue between Project stakeholders to resolve environmental, social and public disclosure issues; to determine whether the Bank has complied with its Environmental and Social Policy or Project-specific provisions of its Access to Information Policy; and where applicable, to address any existing non-compliance with these policies, while preventing future non-compliance by the Bank.

Please visit the Independent Project Accountability Mechanism webpage to find out more about IPAM and its mandate; how to submit a Request for review; or contact IPAM  via email ipam@ebrd.com to get guidance and more information on IPAM and how to submit a request.

 

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