Synthetic balance sheet securitisation Greece

Location:

Greece

Project number:

53189

Business sector:

Financial institutions

Notice type:

Private

Approval date:

08 Dec 2021

Status:

Signed

PSD disclosed:

17 Dec 2021

As permitted by paragraph 2.6 of Section III of the Access to Information Policy, disclosure of this PSD was deferred in accordance with paragraph 1.4.4 of the Directive on Access to Information.

Project Description

Investment of EUR 10 million in credit linked notes, issued by Aurora SME I Designated Activity Company (the "Issuer"), covering the credit risk of the mezzanine tranche in a synthetic balance sheet securitisation of a performing SME and corporate loans portfolio, originated by Alpha Bank S.A., a commercial bank incorporated in Greece (the "Originator" or "Alpha").

Project Objectives

The project boosts the resilience of a systemic bank in Greece, by allowing Alpha Bank to achieve a risk-weighted assets' relief and optimise its regulatory capital requirements. Furthermore, the EBRD promotes resource efficiency in the country by requiring Alpha Bank to allocate funds in the amount of 1.5 times of EBRD's subscription to finance green investments in renewable energy and energy efficiency.

Transition Impact

ETI score: 60

The project delivers transition impact through the Resilient quality, as it contributes to the optimisation of the bank's capital structure by achieving weighted assets' relief and freeing up lending capacity, and support the establishment of an innovative instrument in the Greek market, the use of which remains limited to date. The project also supports the Green transition quality and the EBRD's Green Economy Transition ("GET") approach in Greece through Alpha Bank allocating a multiple of the EBRD investment towards projects, which meet strict GET-eligibility criteria.

Client Information

AURORA SME I DESIGNATED ACTIVITY COMPANY

The Issuer: Aurora SME I Designated Activity Company is a securitisation special purpose entity established in Ireland for the purposes of the synthetic balance sheet securitisation originated by Alpha.

The Originator: Alpha Bank is one of four systemic banks in Greece with a market share by assets of c. 24% as of end-June 2021. Since April 2021, it is fully owned by Alpha Services and Holdings ("ASH"), which is listed on the Athens Stock Exchange.

 

EBRD Finance Summary

EUR 10,000,000.00

Investment of EUR 10 million in credit linked notes

Total Project Cost

EUR 152,000,000.00

Additionality

The project is additional in terms of innovative financing structure and risk mitigation, as the Bank supports Alpha's first synthetic securitisation issuance in a market, where the instrument is novel, while EBRD's participation as a stable investor facilitates further mobilisation of institutional investors. The project also involves standard-setting in the request to allocate EBRD participation proceeds to GET-eligible projects meeting certain demanding standards and certification requirements. This helps Alpha Bank to promote green projects and enhance awareness and deployment of funds in this area and sets a market example for sustainable finance.

Environmental and Social Summary

Categorised FI (2019 ESP). Alpha Bank is an existing client and well known to the EBRD through previous exposures. Under the existing exposures, Alpha Bank is in compliance with the EBRD's Performance Requirements 2, 4 and 9. Alpha Bank will continue to comply with these PRs, implement EBRD's applicable E&S Risk Management Procedures including the specific eligibility criteria for wind, solar, hydro, geothermal or biomass projects, as relevant; and continue to submit annual environmental and social reports to the EBRD.

Technical Cooperation and Grant Financing

None

Company Contact Information

Ioannis Asimelis
ioannis.asimelis@alpha.gr
+302103264118
+302103268309
www.alpha.gr
40 Stadiou Str., Athens, 102-52, Greece

PSD last updated

17 Dec 2021

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.

 

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