This project was approved in the context 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.
The provision of a senior unsecured loan of up to US$ 25 million in the local currency equivalent (synthetic UZS) under the Resilience Framework in favour of Uzpromstroybank ("UzPSB"). The proceeds of the loan will be channelled by UzPSB to the businesses operating in Uzbekistan. This project was approved in the context of the Bank's response to the COVID-19 pandemic.
The proposed project will allow UzPSB to: (i) provide much needed funding in the local currency to eligible sub-borrowers thus improving the resilience of the financial sector; and (ii) help UzPSB to maintain and grow its market share in lending to the local private borrowers despite of the COVID-driven market disruption. Moreover, continued lending to the SME segment will be essential for the bank's management to carry on the Transformation efforts.
ETI score: 80
The transition qualities are Resilient and Competitive. The operation will contribute to the resilience of the financial sector and promote competition in the sector. More specifically, it will help UzPSB to remain solvent and operational (Resilient) and continue commercial lending in line with the market and comparable players (Competitive).
UZBEK INDUSTRIAL AND CONSTRUCTION BANK JSCB (UZPROMSTROYBANK)
UzPSB is the oldest bank in the country, ranked second by assets out of 30April 2020. The bank is majority-owned by the state via the Uzbekistan Fund for Reconstruction and Development ("UFRD") 82.1 per cent and the Ministry of Finance 12.8 per cent. UzPSB follows a universal banking model and serves more than 1 million clients, including 56,000 corporates, via its 45 branches and 170 outlets across the country. Currently, UzPSB is undergoing a Transformation process, which envisions commercialisation of its business model and ultimate privatisation.
EBRD Finance Summary
Total Project Cost
Additionality for the proposed UZS SME loan stems from limited financing options for local SMEs. In light of the limited in-country presence of private investors or IFIs, which provide both access to financing and know-how to local players, the Bank's role would be particularly visible, helping to attract more private investors. The intangible benefits of the Bank's involvement with a key local player will also help facilitate the sector-wide transition toward a more competitive and commercial business model.
Environmental and Social Summary
Categorised FI (ESP 2019). UzPSB Bank is an existing client with a previous TFP line and recently signed SME loan. Environmental and Social Due Diligence (ESDD) was recently completed for the SME transaction and included a further review of the Borrower's Environmental and Social Management System, which is currently being updated with input from the IFC. The ESMS is considered generally aligned with Performance Requirement (PR) 9 and will reach full compliance with updates to refer to the EBRD specifics including the ESP 2019, exclusion and referral lists. In addition the Borrower will need to continue to comply with PR2 and 4 and the EBRD's Environmental and Social Risk Management Procedures for Corporate, SME and Micro Loans. The Borrower will continue to be required to submit annual environmental and social reports to the Bank.
Technical Cooperation and Grant Financing
UzPSB will continue to benefit from existing TC assignments started for previous projects: "Uzbekistan: Financial Institutions Development TC Programme" (TCRS 8332, €5 million total cost, TC Com approved 12/07/2017), which supports development of an SME lending programme and strengthens the Treasury function.
UzPSB will also continue to benefit from TC under the "Regional Small Business Programme for Central Asia - TC Programme" (TCRS 7579) by way of participating in centralised training workshops and e-learning courses. Although the in-person workshops had been put on hold due to the COVID-19 pandemic, they are expected to resume after the restrictions on travel are lifted; the disruption is not expected to affect UzPSB's efficient utilisation of the proposed loan.
Company Contact Information
+998 71 200 43 43
3, Shakhrisabz street, Tashkent city, 100000, Uzbekistan
PSD last updated
15 Oct 2020
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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.
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 email@example.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.
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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).
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 how to submit a Request for review through our confidential online form, by email, mail or telephone. IPAM is available to discuss your concerns and answer any questions you may have about the submission or handling of Requests, which follow the Project Accountability Policy and Guidance. Requesters’ identities may be kept confidential, upon request.