Provision of a senior unsecured loan of up to EUR 10m to UniCredit Bank dd ("UCB") under the Go Digital Pilot in Bosnia and Herzegovina programme (the "Programme"). The entire Programme is supported with donor funds in the total amount of EUR 9m from the European Union.
The Project supports the aim of the Programme to: (i) improve SMEs' access to finance in order to invest additional resources to introduce EU standards through the provision of financing and investment incentives; (ii) pilot an approach to supporting SMEs that invest in automation and digitalisation with minimum 60% of funding to be invested in automation and digitalisation investments and minimum 10% of funding to be invested in only digital investments, (iii) support transition to a green economy ("GET technologies"), by targeting a GET-eligible share of at least 60%, and (iv) increase the awareness and knowledge of SMEs in Bosnia and Herzegovina ("BiH") through the Advice for Small Business services ("ASB") with a focus on automation and digitalisation projects.
ETI score: 65
The Project contributes to the overall objectives of the Go Digital Pilot in BiH Programme, supporting the Competitive and Green TI qualities.
Competitive: The Project will be encouraging the competitiveness of SMEs in Bosnia and Herzegovina by (i) supporting SMEs in accessing finance towards EU standards investments; (ii) targeting the financing of a significant share of automation and digitalisation among those investments; and (iii) offering potential and participating sub-borrowers advice and know-how for overall greater competitiveness of SMEs with a focus of introducing and implementing automation and digitalisation investments.
Green: The Project will also contribute to the green transition impact quality by addressing energy efficiency as part of the eligible activities of investments of SMEs in BiH. The project will contribute to building a green economy in the country by facilitating the expansion of climate change mitigation investments and sharing the positive demonstration effect through on-lending to SMEs.
UNICREDIT BANK DD
UniCredit Bank d.d. ("UCB") is the largest universal commercial bank incorporated and operating in Bosnia and Herzegovina. It has 17.8% market share by total assets (YE2021). The bank has 70 branches covering almost all major cities and towns in the Federation of BiH, served by 1,188 employees."
EBRD Finance Summary
Total Project Cost
Additionality is achieved by combining the necessary long-term financing via UCB with TC and investment incentives into a package that promotes automation and digitalisation as well as green lending in Bosnia and Herzegovina.
Environmental and Social Summary
Categorised FI (ESP 2019). UniCredit Bank dd is an existing client and its performance to date for existing exposures has been satisfactory. UniCredit Bank dd will be required to continue to comply with PRs 2, 4 and 9, and implement the EBRD's E&S Risk Management Procedures for Corporate, SME and Micro Loans including adherence to the expanded EBRD E&S Exclusion List and Referral List introduced with ESP 2019 and submit annual E&S reports to the Bank. Sub-borrowers financed through UniCredit Bank dd loan will be required to comply with national environmental, health, safety and labour (EHSL) requirements. The GET share associated with this transaction is 60%. The Project's use of proceeds or allocated multiple may include solar sub-projects. Such sub-projects will be managed in line with 'The Proposed Management Approach for Solar Supply Chain Risk Management' (CS/FO/21-35) and any subsequent guidance developed under that approach.
Technical Cooperation and Grant Financing
The entire Go Digital Pilot in BiH Programme is supported with grant funds from the European Union for (i) Technical Cooperation ("TC") of total EUR 1,600,500 and for financing of (i) Investment Incentive payments to sub-borrowers ("Non-TC") of total EUR 6,000,000.
Additionally, ASB, with a total of EUR 994,500 grant from the European Union, will support SMEs (that could be potential or participating sub-borrowers under the Programme) with direct advice, training and other outreach activities with a focus on automation and digitalisation priority areas. These funds will be spent according to ASB policies of co-payment.
TC: The TC includes support for a Project Consultant that will assist with the implementation and monitoring of the entire Programme and a separate Verification Consultant that will verify the technical implementation of the investments by the sub-borrowers before the incentive payment is released.
Non-TC: EUR 1,500,000 of grant funds for this Project are provided for investment incentives to sub-borrowers for the implementation of eligible investments in line with the Go Digital Pilot in BiH Policy Statement.
Company Contact Information
+387 36 356 635
+387 36 356 227
Kardinala Stepinca bb 88000 Mostar Bosnia and Herzegovina
PSD last updated
18 Aug 2022
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