Transcapitalbank MSE Loan

Location:

Russia

Project number:

42488

Business sector:

Financial institutions

Notice type:

Private

Environmental category:

FI

Target board date:

13 Apr 2011

Status:

Completed

PSD disclosed:

15 Mar 2011

Translated version of this PSD: Russian

Project Description

The EBRD is planning to arrange an A/B loan to Transcapitalbank (TCB), a Moscow/ Russian Federation based mid-sized bank, with Bank im Bistum Essen participation (the “Loan”). The Loan is for USD 13 million and will consist of USD 10 million for the account of EBRD (for on-lending to small and medium-sized enterprises [SME]) and of USD 3 million for the account of the participant (for on-lending to micro and small enterprises [MSE]).

Transition Impact

The Loan will allow TCB to realize its strategy of expanding MSE and SME lending, in particular in the regions. This will increase the competition for MSE and SME borrowers and will contribute to employment and growth in such regions.

At the same time there will be the following demonstration effects:

1) The Loan will be the first precedent of mid-term (3 years) lending to mid-size private Russian bank by international lender after the financial crisis of 2008. It is expected to set an important example and provide TCB with access to longer-term funding.

2) TCB benefited from intensive TC under EBRD’s Russia Small Business Fund in 2007 and 2008, which greatly improved its MSE lending capabilities. These institutional capabilities will now be better exploited as TCB will reach out to additional MSE borrowers across a number of regions. The quality of TCB’s lending approach in poorly covered regions will result in a wider demonstration of a sound approach to MSE lending.

The Client

TCB is the 49th largest bank in Russia by total assets as at the end of 2010, with a traditional focus on mid-sized corporate clients and MSME, covering 18 regions of Russia and serving 22 954 corporate and 189 455 private customers. TCB is 46% owned by its management. EBRD has been cooperating with TCB since 2003 and became a shareholder in TCB in 2006. DEG is also a shareholder in TCB.

EBRD Finance

The Loan is for USD 13 million and will consist of USD 10 million for the account of EBRD (for on-lending to small and medium-sized enterprises [SME]) and of USD 3 million for the account of the participant (for on-lending to micro and small enterprises [MSE]).

Project Cost

USD 13 million, thereof USD 10 million for the account of EBRD.

Environmental Impact

Categorised FI under EBRD's 2008 Environmental and Social Policy. Through due diligence and reporting on previous projects TCB has confirmed compliance with the Bank's environmental and social requirements. 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 EBRD’s 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

 

Business opportunities

For business opportunities or procurement, contact the client company.

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Email: procurement@ebrd.com

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