- EBRD to provide NLB with Additional Tier 1 capital
- Bank to invest €80 million
- Amount equivalent to 2.5 times EBRD investment to be allocated to MSME lending
The EBRD is supporting the financial sector and micro, small and medium-sized enterprises (MSMEs) in Slovenia and the Western Balkans with an investment of €80 million in Additional Tier 1 (AT1) notes issued by Nova Ljubljanska Banka d.d., Ljubljana (NLB). NLB is the largest bank in Slovenia and also operates in the Western Balkans.
The notes are eligible as Additional Tier 1 (AT1) capital under the European Union’s Capital Requirements Regulation (CRR) and will be rated and listed on the Luxembourg Stock Exchange. NLB will be the first Slovenian bank to issue a CRR-compliant AT1 instrument.
The EBRD financing will strengthen NLB’s capital base and support its growth in Slovenia and throughout the Western Balkans region. The EBRD’s investment comes at a time of disrupted capital markets and reduced appetite among investors and will facilitate the introduction of a new instrument to the Slovenian market, further supporting development of the country’s capital markets.
As part of the financing agreement, NLB will allocate to MSME lending across Slovenia and the Western Balkans an amount equivalent to 2.5 times the EBRD’s investment, supporting a continued flow of funding to MSMEs. The transaction builds on a productive relationship that is based on shared values and ambitions for the region and the banking sector.
NLB is the largest banking group in Slovenia, with a market share of approximately 30 per cent as at 30 June 2022 and regional presence in five strategic Western Balkans markets, where it has a leading franchise. The bank is listed on the Ljubljana Stock Exchange, while global depositary receipts (GDRs) representing shares are listed on the London Stock Exchange. The EBRD is a minority shareholder in NLB, with a stake of 7.125 per cent.
Developing and strengthening local capital markets is of one of the EBRD’s priorities in Slovenia. The Bank has been operating in the country since 1992 and, to date, has invested more than €1.3 billion in 103 projects there.