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Zagreb Holding Bond Issuance



Project number:


Business sector:

Municipal and environmental infrastructure

Notice type:


Environmental category:


Approval date:

22 Jun 2016



PSD disclosed:

21 Jul 2016

Translated version of this PSD: Croatian

Project Description

The EBRD participated in HRK 1.8 billion, 7-year, local bond issue of Zagreb Holding (Holding) with the total amount of HRK 44.6 million invested. The bond issuance was supported with unconditional guarantee from the City of Zagreb (City). Proceeds of the bond issuance will be used to refinance the City's existing EUR 300 million Euro-bonds.

Project Objectives

The proceeds of the bond issuance will be used to refinance the City's existing EUR 300 million Eurobonds.

Transition Impact


The transition impact of the proposed transaction will be achieved through:

  • Demonstration of new ways of financing for the local municipally owned public companies. The transaction will have high demonstration effect both by: (i) encouraging other issuers to tap local capital markets, further deepening the market; and (ii) encouraging investors to participate in subsequent bond issues planned by other municipalities and/or municipal corporates. As the largest municipal entity in the market the issue will provide a pricing benchmark through a publicly traded security that will enable both the Holding and investors to examine how the market prices municipal risk
  • Framework for markets and economic efficiency with transition impact deriving from the Bank engagement in policy dialogue with the Croatian National Bank to promote repo-eligibility of the Bond Issue, which would significantly improve the attractiveness of the issue for the commercial banks and would be the first non-sovereign financial instrument acceptable as repo collateral.

Client Information


Zagreb Holding is a municipal holding company, incorporated in Croatia and fully owned by Croatia's capital City. Holding provides water services, public transport, parking, solid waste collection and disposal, gas supply and other communal services to the citizens of Zagreb through a network of branches and subsidiaries (currently there are 15 branches and 9 subsidiaries). Currently it has a staff of roughly 10,500 employees.

EBRD Finance Summary

EUR 55,958,374.00

EBRD participated in the bond issue with an amount of HRK 44.6 million (~ EUR 5.95 million).

Total Project Cost

EUR 295,958,374.00

HRK 1.8 billion (~ EUR 240 million)

Environmental and Social Summary

Categorised B (2014 ESP). The proceeds of the new Bond issue are intended to refinance Zagreb Holding's existing Eurobond, and are not envisaged to be directed at specific physical assets or any new CAPEX investments. Environmental and social Due Diligence ("ESDD") was done within the Bank and included a top-level review of the Company's Environmental and Social performance based on information from previous projects implemented during 2007-2015 and focused on assessing the risks and impacts inherent to the business sectors in which Zagreb Holding operates. ESDD was, however, limited due to the restrictions imposed by the capital market rules. The implementation of the Bank's financed projects has resulted in positive environmental and social impacts and greatly contributed to improving access to good quality drinking water, waste management, reducing public health risks and the overall increase of life quality standards. The Company has largely implemented the Environmental and Social Action Plan ("ESAP") agreed with the Company for the previous project. To fully comply with the Bank's Performance Requirements ("PRs") further improvements will be required.. Corrective measures required at the corporate level to meet EBRD PRs will be addressed through the side letter.

The Bank will continue to work closely with the Company and monitor its E&S performance and implementation of the ESAP.

Technical Cooperation

Technical Assistance was not provided under the transaction.

Company Contact Information

Ana Stojic Deban, President of the Management Board
+385 1 6420 000
Zagrebacki holding d.o.o. Ulica grada Vukovara 41 10 000 Zagreb, Croatia

Business opportunities

For business opportunities or procurement, contact the client company.

For state-sector projects, visit EBRD Procurement: Tel: +44 20 7338 6794

General enquiries

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