Provision of a EUR 60 million senior preferred unsecured loan to ProCredit Bank (Bulgaria) EAD ("PCBB"). The loan will have two equal tranches of EUR 30 million each.
The proposed Project aims to support the resilience of PCBB, a recognised SME-dedicated bank in Bulgaria, in a challenging market environment and to finance businesses in Bulgaria directly or indirectly affected by economic consequences of the war on Ukraine, with the ultimate goal of preserving livelihoods in the country.
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 helping PCBB in meeting its respective regulatory requirements towards loss absorbing funding base and also support the 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 Bulgaria, particularly MSMEs, which have been directly and indirectly impacted by the ongoing war and its spill-over effects on the regional economies.
PROCREDIT BANK BULGARIA EAD
PCBB was established in 2001 and is part of the international ProCredit Holding group, a network of SME banks. With total assets of EUR 1.8 billion as at end-June 2022, the bank ranks 10th among 25 banks operating in the Bulgarian market. PCBB is rated by BBB-/Stable by Fitch (July 2022).
EBRD Finance Summary
Bail-in-able bilateral senior preferred unsecured loan.
Total Project Cost
Total bail-in-able funding for 2022-2024 to be raised by PCBB.
Financing structure and risk mitigation:
Given the insufficient capacity and low liquidity of the local capital market, the project will be closing the funding gap and ensuring PCBB raises enough bail-in-able funding to meet its regulatory requirements.
- Portion of the loan proceeds will be used to finance green investments in line with EBRD Green Economy Transition approach, thus supporting the bank's efforts in promoting and financing projects with clear environmental benefits beyond the normal course of banking business and enhancing awareness and deployment of funds in this area.
- As part of the project, PBCC commits to identify gender gaps in the workplace and take appropriate measures to improve overall staff engagement.
Environmental and Social Summary
Categorised FI (ESP 2019). PCBB is an existing client and will be required in relation to this project 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 PCBB 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
Company Contact Information
ProCredit Bank (Bulgaria) EAD Head Office
(+ 359 2) 81 35 808 /809
(+ 359 2) 81 35 109
26 Todor Aleksandrov Blvd., Sofia 1303
PSD last updated
30 Aug 2022
Further information regarding the EBRD’s approach to measuring transition impact is available here.
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Environmental and Social Policy (ESP)
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More information on the EBRD’s practices in this regard is set out in the ESP.
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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).
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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 email@example.com to get guidance and more information on IPAM and how to submit a request.