Transcapitalbank Capital Increase

Translated version of this PSD: Russian

Project Description

The EBRD is considering a participation in capital increases of Transcapitalbank (TCB), a Moscow/ Russian Federation based mid-sized bank, in two tranches with an aggregate EBRD subscription price of up to RUB 1,287,000,000 over two years. The first subscription is scheduled for mid-2011 in the amount of RUB 572 million within EBRD’s pre-emptive rights, EBRD being an existing shareholder. The second subscription in the amount of up to RUB 715 million is scheduled for 2012. In the course of each transaction EBRD will maintain its current stake of 28.6% in TCB’s capital and voting rights.

Transition Impact

The capital increase with EBRD participation will provide TCB, a successful private-sector bank, with a solid capital base to realize its further expansion into the regions outside of Moscow and St. Petersburg, and into the segment of lending to micro, small and medium-sized enterprises (MSME). This will foster competition for lending to MSME in currently 16 regions of TCB’s presence and improve MSMEs’ access to loans.

Moreover, this capital increase will support a bank that already demonstrates above-average corporate governance and is committed to further improving its corporate governance. This is expected to be noticed and subsequently emulated by other market participants and can therefore be assumed to have a strong demonstration effect.

The Client

TCB is the 49th largest bank in Russia by total assets, with a traditional focus on mid-sized corporate clients and MSME, covering 16 regions of Russia and serving almost 200,000 customers. EBRD has been cooperating with TCB since 2003 and became a shareholder in 2006. TCB is to a large degree owned by its management and DEG is also a shareholder in TCB.

EBRD Finance

The aggregate EBRD subscription price amounts to up to RUB 1,287,000,000 over two years.

Project Cost

The aggregate EBRD subscription price amounts to up to RUB 1,287,000,000 over two years.

Environmental Impact

Categorised FI under EBRD's 2008 Environmental and Social Policy. Through due diligence and reporting on previous projects Transcapitalbank (TCB) has confirmed compliance with the Bank's environmental and social requirements. Transcapitalbank (TCB) has received environmental and social risk management training from the Bank and agreed a corrective Environmental and Social Management Plan (ESMP). This ESMP has been fully implemented by TCB, including the development and implementation of TCB's own environmental and social risk management policy and procedures. TCB is required to continue compliance with EBRD's Performance Requirements 2 and 9 and provide the Bank with annual environmental and social reports.

Technical Cooperation

TCB received Technical Cooperation under the Russia Small Business Fund and within the framework of an Institutional Building Plan.

Company Contact

Arvid Tuerkner, Senior Banker, EBRD Moscow Resident Office
E-mail: tuerknea@ebrd.com