SDM Bank Equity Investment

Location:

Russia

Project number:

41143

Business sector:

Financial institutions

Notice type:

Private

Environmental category:

FI

Approval date:

14 Sep 2010

Status:

Complete

PSD disclosed:

14 Sep 2010

Translated version of this PSD: Russian

Project Description

The EBRD Board of Directors approved an equity investment into newly issued ordinary voting shares of SDM bank by subscribing for up to 15 percent of capital and voting rights.

The investment will support a strong well managed profitable medium sized bank with good prospects for a strategic sale that will have a positive demonstration effect.

Transition Impact

Equity Investment will provide SDM with new capital.

By partnering with SDM, the Bank would help to strengthen SDM’s capital base, enhance SDM’s strategy, improve business processes, efficiency and corporate governance by means of an institutional building plan.

The EBRD’s representation on SDM’s Board will contribute to corporate governance strengthening and institutional development.

EBRD’s presence among SDM’s shareholders and improved governance could lead to further diversification of SDM’s funding sources as well as to stronger sustainability and efficiency.

The Client

SDM Bank (“SDM”) is a medium sized, privately owned bank based in Moscow. At end-2009, SDM was the 114th bank among the Russian banks by assets (USD 649.8 million). SDM strategy targets SMEs via its 39 offices in Moscow and eight regions of Russia. SDM is controlled by a local individual (76%), 10% stake belongs to Firebird Avrora Fund Limited (American investment fund)

EBRD Finance

Equity: 15% of capital and voting rights after subscription.

Project Cost

n/a

Environmental Impact

Categorised FI in accordance with EBRD's 2008 Environmental and Social Policy. Due diligence has reviewed the capacity of the client to effectively adopt and implement Bank’s Performance Requirements and found that it is satisfactory. SDM bank will be required to comply with the Bank's Performance Requirements 2 (Labour and Working Conditions) and 9 (Financial Intermediaries) which include implementation of the Bank's Environmental and Social Procedures for Corporate Lending across the full range of its business activities and adherence to EBRD's Environmental and Social Exclusion and Referral Lists. In early 2010 SDM has received EBRD's environmental and social risk management training for FIs, and a separate E&S Risk Management Plan has been prepared for SDM to ensure its compliance with PRs 2 and 9. SDM will be required to implement this Plan and to submit annual environmental and social reports to the Bank.

Technical Cooperation

TC funds will be sought for funding of the IBP implementation.

Company Contact

Anna Kolokoltseva
International Business Director

e-mail: kolokoltseva@sdm.ru

Business opportunities

For business opportunities or procurement, contact the client company.

For state-sector projects, visit EBRD Procurement: Tel: +44 20 7338 6794
Email: procurement@ebrd.com

General enquiries

EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com

Public Information Policy (PIP)

The PIP 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. Please visit the Public Information Policy page below to find out how to request a Public Sector Board Report.
Text of the PIP

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