EBRD Trade Facilitation Programme: Supporting Trade Finance in Eastern Europe and the Mediterranean

1. EBRD Trade Facilitation Programme (TFP) Development of Trade Finance in Eastern Europe, the CIS and the Southern and Eastern Mediterranean • Rudolf Putz, Head of TFP • Kiev 19 September 2019

2. EBRD Countries of Operation

3. EBRD Trade Facilitation Programme (TFP) • Facilitates financing of all stages of the trade chain

4. How TFP facilitate trade in Ukraine? • TFP supports trading by providing: • Access to finance: i) Guarantees that cover risks arising from trade finance and factoring transactions; (ii) Cash advances/financing to issuing banks for trade finance and factoring purposes; • Policy Dialogue – joint work with NBU (regulator) to support international and local trade • Capacity Development: donor funded trade finance training and advisory services to issuing banks and factoring companies 12 September, 2019

5. TFP Guarantees: Example – Import of a grain harvesters from Switzerland into Ukraine An Ukrainian company imports grain harvesters from Switzerland An Issuing Bank under the TFP in Ukraine issuesaletter of credit for EUR 1 million, confirmed by a Confirming Bank under the TFP in Italy EBRD covers 100% of the political and commercial payment risk

6. Green Trade Facilitation ProgrammePortfolio in 2016-18 Technologies Countries Other countries: Egypt, North Macedonia, Turkey, Azerbaijan, Bulgaria, Kyrgyz Republic

7. Green Trade Facilitation ProgrammeApproach • The Green Trade Facilitation Programme stimulates the supply of green technologies into the EBRD’s region of operations Finances exports, imports and local distribution of green technologies, thus strengthening the supply chains of such technologies In 2019, during its Annual Meeting, the EBRD awarded the most active issuing and confirming banks in green trade for the first time Green Trade Facilitation Programme supports energy efficiency, water efficiency, renewable energy and climate resilience technologies, compliant with the EBRD’s requirements

8. EBRD Trade Facilitation Programme (TFP) 20 years: 1999 - 2019 • Over 200 issuing banks and over 800 confirming banks in the TFP network • EUR 17.6 billion of trade activity supported since 1999 • Over 150 partner banks and 9,186of bank’s staff received training since 2010

9. EBRD TFP – Active Issuing Banks in Ukraine • Credit Agricole Ukraine • Oschadbank • OTP Bank • Raiffeisen Bank Aval • State Export-Import Bank of Ukraine • Ukrsibbank • Piraeus Bank • Ukrgazbank • Bank Lviv • (one more bank in 2019)

10. TFP - 1,740 Transactions in 2018Ranking No of Transactions by Country Greece Serbia Ukraine Cyprus Belarus Mongolia Armenia Georgia Morocco Turkey Egypt Kyrgyz Republic Uzbekistan • Romania • Bulgaria • North Macedonia • Tajikistan • Lebanon • Kosovo • Jordan • Moldova • Croatia • Montenegro • Tunisia • Bosnia and Herzegovina • Albania • Kazakhstan

11. TFP - Top 25 Confirming Banks Ranked by Number of Transactions in 2018 Commerzbank A.G. ING BANK N.V. Unicredit S.P.A. ODDO BHF Aktiengesellschaft UBS Citibank Europe PLC Intesa Sanpaolo S.p.A. KBC Bank NV Deutsche Bank Raiffeisen Bank Credit Agricole CIB BANCA POPOLARE DI SONDRIO • Societe Generale • CAIXABANK S.A. • Sberbank • BNP Paribas • UBI Banca SCPA • Credit Suisse (Switzerland) Ltd • Erste Group Bank AG • JSC Bank Centercredit • Banco de Sabadell S.A. • TURKIYE VAKIFLAR BANKASI T.A.O. • JP Morgan Chase Bank • Turkiye IS Bankasi A.S. • Credit Europe Bank N.V.

12. TFP - Over 800 Confirming Banks in 77 Countries

13. EBRD TFP – Co-Financing Partners • ACE Global Markets (AGM) & Lloyds of London • AKA Bank, Germany • Arab Trade Finance Program, Abu Dhabi • Confirming Banks • Donor Risk Sharing Funds • Export Credit Agencies • FMO Netherlands • OPEC Fund for International Development, Vienna • Private Investment Funds 12 September, 2019

14. EBRD TFP – Capacity Development Projects 14

15. EBRD- Projects to facilitate international trade Networking events to enable industry collaboration E-Learning Courses Face to face workshops Policy dialogue 15

16. International Trend of “De-risking” • Financial institutions reduced their correspondent banking relationships due to the increased KYC costs • The costs for western banks of maintaining KYC foreach RMA key is estimated between $20,000 -70,000 depending on the level of due diligence • According to SWIFT, between 2016 and July 2018, the number of correspondent banking relationships in CEEdeclined by 23%on average. 13,000+ RMAs were closed during this time

17. How can EBRD assist? • EBRD’s New Capacity Building Programme consists of three elements: • Introducing KYC and AML Utilities • Specialist Training Courses • Customised Advisory Services

18. EBRD- EBRD- Compliance Capacity Building Framework 2019 Pilot Project started in Ukraine March 2019 18

19. EBRD’s CAPACITY BUILDING PROGRAMME (1/3) • Introducing KYC and AML Utilities • EBRD will support local banks in countries of operation to create KYC profiles and documents, collaborating with KYC utility providers such as SWIFT, ACCUITY and Wolfsberg Group • EBRD and 91 TFP’s issuing banks from 27 countries have already joined the KYC Registry

20. EBRD’s CAPACITY BUILDING PROGRAMME (2/3) • II. Specialised Training Courses • The trainings delivered by EBRD in collaboration with International Compliance Association (200 places offered in 2018 and 400 places in 2019): • ICA Certificate in Know Your Customer and Customer due diligence • ICA Specialist Certificate in Trade Based Money Laundering • ICA Certificate in Financial Crime Prevention • ICA Certificate in Correspondent Banking • Training on Wolfsberg Questionnaire – will be delivered in collaboration with ICA and Wolfsberg Group • Training on Trade Based Financial Crime Compliance - will be delivered in collaboration with London Institute of Banking and Finance

21. EBRD Pilot Compliance Training with ICAin 2018 ICA professional certification and workshops ICA compliance workshops held in Belarus, Ukraine, Morocco and Uzbekistan KYC/CDD and Trade Based Money Laundering workshops arranged jointly by EBRD and International Compliance Association with 200 attendees in total from EBRD partner banks

22. EBRD’s CAPACITY BUILDING PROGRAMME (3/3) • III. Customised Advisory Services • EBRD will offer individual correspondent banking advisory services to assist partner banks in: • optimising and standardizing KYC required documents • enhancing correspondent banking relationships with EBRD TFP networking platform of over 800 Confirming Banks. • implementing improved compliance functions and processes in line with the international standards: • ISO 19600 “Compliance management systems” • ISO 37001 “Anti-bribery management systems” 12 September, 2019 22

23. Donors • TFP Technical Cooperation (TC) Projects funded by: • The Early Transition Countries Fund • The Shareholder Special Fund • European Union • Norwegian, Swiss, Italian, Canadian, Taiwanese funding and other donors

24. TFP Trade Finance ForumAthens, Greece, 23-24 October 2019 12 September, 2019

25. Financing Trade with EBRD – Trade Facilitation Programme (TFP)Tashkent, Uzbekistan, 6-7 November 2019 12 September, 2019

26. Contacts Join us in social networks: Twitter:www.twitter.com/ebrdtrade Facebook:www.facebook.com/ebrdtfp LinkedIn: www.linkedin.com/groups?gid=4667852 • Trade Facilitation Programme • European Bank for Reconstruction and Development • One Exchange Square, London EC2A 2JN, UK • E-mail: Group-TFPOps@ebrd.com • Web-site: www.ebrd.com/tfp • Rudolf Putz • Head of TFP • Tel: +44 207 338 7776 • E-mail: putzr@ebrd.com Marco Nindl Principal Banker Tel: +44 207 338 7614 E-mail: nindlm@ebrd.com Kamola Makhmudova Senior Banker Tel: +44 207 338 7731 E-mail: makhmudk@ebrd.com 26