Project Description
This project was approved as part of the Bank's response to the Covid-19 pandemic. To avoid delays to the delivery of this project, the Bank's President granted a deviation from the ordinary timelines for PSD disclosure, as contemplated by Section V of the Directive on Access to Information. Details of the Bank's response to Covid-19, and this deviation, can be found on our website.
A senior unsecured loan of up to USD 75 million in favour of Denizbank, a universal commercial bank incorporated in Turkey. The proceeds of the loan will be channelled by Denizbank to micro, small and medium enterprises (MSMEs) operating in the agribusiness sector and smaller municipalities in Turkey.
The loan is complemented by an uncommitted USD 100 million trade finance line to support the lender's trade finance activities.
Project Objectives
The operation will enable the lender to increase the availability of short-term financing to MSMEs and smaller municipalities in Turkey facing liquidity stress due to the Covid-19 crisis.
Transition Impact
ETI score: 60
The main goal of the operation is to ensure resilience and preserve competition in the financial sector. The transition impact of the project will stem from "Resilient" and "Competitive" transition qualities by providing Denizbank with funding to scale up its lending activities as part of its ongoing growth trajectory and to remain an active and effective market player amid the Covid-19 crisis.
Client Information
DENIZBANK AS
DenizBank is the fifth largest private bank (eigth when state-owned banks are included) in Turkey with circa 5% market share by consolidated assets at the end of 2019. DenizBank is rated B3 (negative) by Moody`s and B+ (negative) by Fitch. It is wholly owned by Emirates NBD Bank PJSC (ENBD), which is rated A3 (Stable) by Moody's and A+ (Stable) by Fitch. Listed on the Dubai Financial Market, ENBD is 56% owned by the state-owned Investment Corporation of Dubai, 5% by Capital Assets LLC, with 39% being free float.
EBRD Finance Summary
USD 75,000,000.00
A senior unsecured loan of up to USD 75 million under the EBRD's Resilience Framework. The loan is complemented by an uncommitted USD 100 million trade finance line to support the lender's trade finance activities.
Total Project Cost
USD 75,000,000.00
The loan is complemented by an uncommitted USD 100 million trade finance line to support the lender's trade finance activities.
Additionality
The project is part of the Covid-19 crisis response. EBRD financing bridges a liquidity gap due to adverse market conditions caused by Covid-19 pandemic and provides a confidence-inspiring signal associated with support from international financial institutions.
Environmental and Social Summary
Categorised FI (ESP 2019): DenizBank is an existing client. The client will be required to continue to comply with the EBRD's Performance Requirements (PRs) 2, 4 and 9, the applicable EBRD Environmental & Social Risk Management Procedures for MSME and corporate loans and submit annual environmental and social reports to the Bank. It will now be required to apply the extended Exclusion List introduced with the Environmental and Social Policy 2019 as well as the Referral List. The use of proceeds of this transaction is for the financing of MSMEs operating in the agribusiness sector and of smaller municipalities in Turkey. The overall environmental and social risk level of this type of loans is low to medium. Denizbank's environmental and social management system is adequate to identify and manage these types of risk.
Technical Cooperation and Grant Financing
N/A
Company Contact Information
Nimet Sinem Yahsi
nimetsinem.yahsi@denizbank.com
+90 212 348 5453
+90 212 336 33 03
www.denizbank.com
Büyükdere Cad. No: 141 Esentepe, Istanbul, Turkey
PSD last updated
08 Jun 2020
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.
