Serbia WHR - Societe Generale Serbia

Location:

Serbia

Project number:

41617

Business sector:

Agribusiness

Notice type:

Private

Environmental category:

FI

Target board date:

22 Jun 2010

Status:

Cancelled

PSD disclosed:

20 Apr 2010

Translated version of this PSD: Serbian

Project Description

The EBRD is considering a participation in a risk sharing framework with Société Générale Serbia with a total amount of up to €20 million for the financing of seasonal working capital needs of local borrowers in the Serbian agricultural sector.

The loans provided to local agricultural producers will be against agricultural commodities in the first stage and once the warehouse receipt system is fully implemented the lending will be backed by warehouse receipts as collateral.

Transition Impact

The envisaged project aims to improve the access to commodity financing for agricultural producers and processors which face very often funding constraints as a result of

(1) the perception of many local banks that agricultural commodity financing is high-risk lending due to the high cyclicality and price volatility and

(2) the inability of local farmers and agribusiness companies to provide sufficient collateral and high expenses related to the establishment of mortgages over land.

The envisaged project will address this funding gap by fostering commercial lending to the Serbian agricultural sector. In particular, the facility will demonstrate how to fund agricultural commodities and related working capital needs by using primarily agricultural commodities as collateral for the underlying loans. In addition, it is envisaged that the project will demonstrate the use of warehouse receipts and thus helping to implement a fully functional warehouse receipt system in Serbia. In addition, the Bank intends to support the implementation of the warehouse receipts programme with a policy dialogue initiative in cooperation with the Food and Agriculture Organization of the United Nations.

The Client

Société Générale Serbia, a fully owned subsidiary of Société Générale Group, France, is one of the leading banks in Serbia.

EBRD Finance

Up to €20 million of risk participation.

Project Cost

Up to €44.4 million.

Environmental Impact

Categorised FI (2008): The provision of short-term working capital to Serbian farmers is not associated with significant environment, health and safety and labour (EHSL) risks. Société Générale Serbia is in compliance with PR2 (Labour and Working Conditions) and with PR9 (Financial Intermediaries). Société Générale will be required to adhere to the EBRD's Environmental and Social Exclusion and Referral Lists, require that borrowers comply with the Exclusion list and with national standards for environment, health and safety and labour and confirm to the Bank on an annual basis that these requirements have been met

Technical Cooperation

The Bank intends to support the implementation of the warehouse receipts programme in Serbia with a policy dialogue initiative in cooperation with the Food and Agriculture Organization of the United Nations.

Company Contact

Milan Vićentić
Executive director
Corporate Division
Société Générale Banka Srbija AD
Corporate banking Division
Bulevar Zorana Đinđića 50 a/b, 11 070 Beograd, Srbija
Tel. +381 (0)11 30 11 426
E-mail: milan.vicentic@socgen.com

 

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