FIF - TBC SME Credit Line

Location:

Georgia

Project number:

48735

Business sector:

Financial institutions

Notice type:

Private

Environmental category:

FI

Target board date:

22 Mar 2017

Status:

Repaying

PSD disclosed:

09 Feb 2017

Translated version of this PSD: Georgian

Project Description

A financing package up to US$ 100 million in two equal tranches denominated in local currency for TBC Bank consisting of three transactions: up to US$ 60 million equivalent in Georgian Lari credit line to assist local Small and Medium Enterprises (SMEs) comply with DCFTA requirements; up to US$ 20 million equivalent in Georgian Lari Women in Business (WiB) financing programme to support SMEs run or managed by women and up to US$ 20 million equivalent in Georgian Lari credit line for on-lending to local Small and Medium Enterprises (SMEs).

Project Objectives

The financing package to enable TBC Bank to develop its lending programmes countrywide in the respective business segments, providing essential support for longer-term financing in local currency to SMEs.

Transition Impact

The transition impact of this operation will include the development of tailored financing instruments in local currency to support SMEs in overcoming DCFTA related challenges as well as addressing gender specific gaps in access to finance by supporting underserved women entrepreneurs.

Through above mentioned credit line facilities, EBRD's support of TBC Bank will contribute to the overall lending capability of the banking sector in Georgia thereby increasing financial intermediation.

The proposed loans will increase the supply of local currency funding to SMEs thereby increasing access to bank finance.

Client Information

TBC BANK JSC

TBC Bank is the leading universal bank in Georgia with total assets of US$ 3.3 billion and a market share of 30 per cent of total assets. TBC Bank Group PLC is listed on the London Stock Exchange.

EBRD Finance Summary

USD 20,000,000.00

Total Project Cost

USD 20,000,000.00

Environmental and Social Summary

Categorised FI (2014). TBC Bank is an existing Client of the EBRD and as such is familiar with the Bank's environmental and social requirements. Reporting to date submitted by TBC Bank has been satisfactory and confirms compliance with not only EBRD requirements but also the requirements of
IFC and ADB.

TBC Bank shall ensure on-going compliance with the Performance Requirements 2, 4 and 9 and provide relevant training to personnel, especially newly-hired and regional branches staff. TBC Bank should also continue to provide annual report on environmental and social matters in a scope and format satisfactory to the EBRD.

Technical Cooperation

The DCFTA credit line is complemented by grant funding (TC and Non-TC) from the European Union (EU) Neighbourhood Investment Facility (NIF) in the form of:

TC: i) to engage a Project Consultant to assist TBC Bank with the implementation and monitoring of the DCFTA programme and ii) a separate Verification Consultant to verify the technical implementation of the investments by the sub-borrowers (SMEs) before the Incentives payment is released to the relevant SME, and iii) Business advice for SMEs to enhance their technical, managerial, market knowledge and investment project development capacity.

Non-TC: investment incentives to sub-borrowers.

The WiB credit line is complemented by grant funding (TC and Non-TC) from the European Union (EU) Neighbourhood Investment Facility (NIF), the Swedish International Development Cooperation Agency (SIDA) and the EBRD's Early Transition Countries (ETC) Fund and the Shareholder Special
Fund in the form of:

TC: i) capacity building to support TBC Bank in developing financial products and lending practices to service specifically women-led SMEs and ii) Business advisory services to increase women SMEs access to know-how, non-financial business development services.

Non-TC: Credit enhancement support to TBC Bank.

Company Contact Information

Tamar Kakulia Deputy CFO Capital Markets and Investor relations
+995 32 227 27 27
www.tbcbank.ge

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