The provision of a senior loan of up to US$ 3.25 million to Demir Kyrgyz International Bank (DKIB) under the KyrSEFF II facility. The proceeds will be on-lent to sub-borrowers for energy and water efficiency investments. The Project will further strengthen SME competitiveness and promote the financial sector development in particular through local currency lending.
The transaction supports investments in high-performing energy efficiency technologies, materials and solutions undertaken in, or in relation to, privately-owned residential/MSME dwellings or buildings in the Kyrgyz Republic. Sub-projects are selected according to technical and financial eligibility criteria set forth in the policy statement for KyrSEFF. 100 per cent of the proceeds will be used for Green Economy Transition investments.
ETI score: 100
The project contributes to following TI qualities:
- Green: The project will support the expansion of energy and water efficiency lending to households and private sector and contribute to positive demonstration effects of GET projects.
Competitive: The project will contribute towards building a more competitive financial sector through developing the internal capacity of the PFIs for financing energy and water efficiency loans.
DEMIR KYRGYZ INTERNATIONAL BANK
DKIB is one of the leading commercial banks in the Kyrgyz Republic ranking 5th in terms of assets and 4th in terms of customer accounts. As of the end of 2020, the bank's market shares stood at 9.1 per cent and 11.4 per cent in terms of banking assets and customer accounts, respectively, with the balance sheet size of US$ 311 million.
EBRD Finance Summary
Senior loan of up to US$ 3.25 million (€2.7 million) or equivalent in KGS with a 4 year tenor including a 1 year grace period; The client will be provided with an option to drawdown either in synthetic KGS or US$.
Total Project Cost
The Bank is additional because of its:
- Terms: At present, there are no private investors that can combine (1) the Bank's relationships with partner banks in the Kyrgyz Republic, (2) its experience with similar energy and water efficiency facilities and (3) tailored technical consultancy services into a commercial financing scheme such as KyrSEFF II in order to realise energy efficiency programmes in the country.
- Attributes: the EBRD is one of the very few institutions providing long term local currency funding in the country and has significant experience in financing energy efficiency programmes using financial intermediaries.
Conditionalities: Clearly defined eligibility criteria for the sub-borrowers under credit line will ensure that funds are directed to the intended group of borrowers and contribute towards achieving anticipated transition impact.
Environmental and Social Summary
DKIB is an existing client and has provided good quality Annual E&S Reports to the Bank to date. DKIB will be required to continue to implement the environmental and social risk management procedure for Micro, SME and Corporate loans; continue to comply with the EBRD's Performance Requirements (PRs) 2, 4 and 9, 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. As applicable, sub-loans under the KyrSEFF facility will need to comply with the E&S Eligibility Procedures for wind, hydro, solar, geothermal or biomass projects.
Technical Cooperation and Grant Financing
Assistance provided under the KyrSEFF II with marketing of sub-loans and assessment of sub-projects from technical/engineering aspects, funded by EU-IFCA.
Company Contact Information
245 Chui Avenue, Bishkek, 720001, Kyrgyz Republic
PSD last updated
20 Oct 2021
Further information regarding the EBRD’s approach to measuring transition impact is available here.
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Independent Project Accountability Mechanism (IPAM)
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