Poland: Corporate Bond Framework

Location:

Poland

Project number:

47824

Business sector:

Manufacturing and Services

Notice type:

Private

Status:

Cancelled

PSD disclosed:

09 May 2016

Project Description

The EBRD is considering providing up to EUR 125 million equivalent to invest in medium to long-term bond instruments, issued by corporates (excluding banks and non-bank financial institutions, e.g. factoring, leasing companies) in Poland. The framework is expected to address the lack of depth of corporate bonds in the domestic market in terms of issuers, size and maturity and is in line with the objectives of the Local Currency and Local Capital Market Development Initiative launched by EBRD in May 2010. It will contribute to: (i) further developing the Polish capital market; and (ii) supporting
the diversification of funding sources of the Polish corporates.

Project Objectives

The framework is intended to promote the development of local currency capital markets through a combination of transactions and ongoing policy dialogue aimed at lengthening the maturity and widening the diversity of issuance types as well as broadening the investor base. By almost any metric the Polish corporate bond market is behind developed markets in Europe or comparable emerging markets. The Polish market lags its peers in many quantitative and qualitative elements.

Average corporate bond market maturity is still relatively short and turnover is low in comparison to its corporate bond market peers. Increasing local currency corporate bond issuances, lengthening maturity and widening the diversity of issuance types and investors base remain key challenges for the Polish bond market.

Transition Impact

The expected transition impact of the framework derives from: (i) demonstrating the viability of local currency bond financing for a broader range of Polish corporates and at the same time aiming to broaden the investor base (ii) market expansion through the building of critical mass of outstanding capital market instruments and supporting the liquidity of the market; and (iii) improved disclosure for private placements.

Client Information

The framework will be available for Polish corporates, excluding banks and non-bank financial institutions (e.g. factoring, leasing companies). The framework will not concentrate on a specific set of corporates (i.e. by size, business activity, and sector) but will be available to issuers from various sectors and various companies from large to mid-size, potentially including large SMEs.

EBRD Finance Summary

EUR 125,000,000.00

Medium to long term bond instruments (public issuances and private placements) issued by corporates in Poland. The framework is intended to included both fixed and floating rate instruments as well as secured and unsecured structures. This is expected to enable the framework to meet a wider range of client and investor needs and allow flexibility in response to market opportunities.

Total Project Cost

EUR 625,000,000.00

Up to EUR 625 million equivalent with the Bank's participation of up to 20% of the respective bond programme.

Environmental and Social Summary

The Framework itself is not categorised; however the sub-projects will be categorised on a case by case basis. Each of the sub-projects will undergo a separate Environmental and Social Due Diligence (ESDD), the scope of which will be determined on the basis of the specific use of proceeds, especially where this involves investment projects. The ESDD will include at the minimum an assessment of potential environmental and social impacts and benefits of the investment projects and the bond issuer's environmental and social management systems and capacity to implement the
Bank's Performance Requirements.

Based on the ESDD, an Environmental and Social Action Plan (ESAP) will be agreed with the respective bond issuer to structure the sub-project to meet the Bank's Performance Requirements.

The environmental and social performance of each sub-project will be reported to the Bank on an annual basis.

Technical Cooperation

None.

Company Contact Information

Konrad Wilczak
wilczakk@ebrd.com
+48 22 520 5700

Business opportunities

For business opportunities or procurement, contact the client company.

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