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EBRD in Romania Symposium Cluj-Napoca 28 March 2007

EBRD in Romania Symposium Cluj-Napoca 28 March 2007. What is the EBRD EBRD in Romania Contacts. What is the EBRD?. AAA-rated international financial institution founded in 1991, owned by 60 national and two supranational shareholders

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EBRD in Romania Symposium Cluj-Napoca 28 March 2007

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  1. EBRD in Romania Symposium Cluj-Napoca28 March 2007

  2. What is the EBRDEBRD in RomaniaContacts

  3. What is the EBRD? • AAA-rated international financial institution founded in 1991, owned by 60 national and two supranational shareholders • EBRD, promotes transition to market economies in 29 countries from central Europe to central Asia • The largest lender and private equity investor in the Region Cumulative commitments € 33.3 billion

  4. A network of 33 offices in 29 countries

  5. What are EBRD’s Objectives? To promote: • Transition to free, market-based economies by supporting private and entrepreneurial initiative • A better investment climate • Good corporate governance at project, corporate and country levels • Environmentally sound and sustainable development

  6. Transport Municipal Infrastructure Portfolio by sector 21% 16% 30% • Natural Resources • Power & Energy • Energy Efficiency 31% • Agribusiness • Property & Tourism • Telecommunications • General Industry

  7. EBRD commitments by facility type Equity participation 8% Financial intermediaries 17% Other participating interest 8% Guarantees, etc 2% Private loans 40% Sovereign loans 25%

  8. EBRD - A catalyst for change Cumulative additional funds mobilised EUR 69.6 billion • EBRD investments have attracted an additional EUR 69.6 billion from domestic and foreign investors • The EBRD uses donor funding to assist project preparation and catalyse foreign investment

  9. Takes political risks Shares financial risks Takes long maturity Shares equity risk Have sound management Take operational risks EBRD risk profile EBRD Sponsors

  10. EBRD in the year 2006 • Record level of commitments: EUR 4.9 billion • Record level of disbursements at EUR 3.8 billion • Record number of projects: 157 • 58% of commitments in South-Eastern Europe, the Caucasus and Central Asia • Disbursements made in each of the Bank’s 29 countries of operations, including Romania and Bulgaria

  11. Why work with the EBRD? • Appetite for risk; largest investor in the region • Flexibility • Expertise • Dedicated teams • Focus in private sector • Local presence • Political support • Mobilising capacity • In-depth legal know-how

  12. EBRD is able to offer a wide array of financial products Loans • Project specific • Hard/local currency • Variety of maturities • Floating/fixed rates • Corporate lending • Limited recourse project finance • Convertible / subordinated • Working capital loans • Minimum size EUR 8 million Equity • New equity • Common stock or preferred shares • Privatisations • Underwriting • Quasi-equity • ‘Portage’ equity • Minority position only • Minimum investment EUR 5 million

  13. 35% Direct financing: Basic Guidelines Minimum EBRD financing Euro 5m • Investments with sponsors with proven sector experience. • Maximum project exposure of 35% of total project cost. • Minimum project exposure of : • - Euro 8 million when debt is sought and • - Euro 5 million in the case of equity investments. Minimum Project Euro 20m

  14. EBRD Direct Investment Guidelines • Debt: no more than two thirds debt to one third equity. • Significant equity contribution from the Sponsor ensuring a prudent capital structure • Equity: contribution may be in-kind (equipment, plant and machinery) or cash. • Appropriate return on investments - a fair balance of risk / reward

  15. Advantages of EBRD involvement • Extensive knowledge of the country and business climate. EQUITY • Long-term partner committed to the country, its lasting development and prosperity. • Substantial political and investor influence in Romania. DEBT • Long maturity periods of up to 12 years. Private sector projects usually up to 8 years with 2 years grace period. • Excellent relationships with commercial banks: access to commercial co-financing. • Availability of financing for working capital.

  16. Who are Potential EBRD Customers? • Local companies with strong fundamentals seeking equity or debt financing (e.g. for refurbishment, expansion, etc.) • Local companies investing Cross-border • State enterprises being privatised or seeking financing • Strategic foreign investors with investment plans in the region – privatisations, joint ventures, green-field • Financial Investors (e.g. venture capital funds, etc.) seeking co-investors

  17. What EBRD is NOT! • Provider of subsidised funding • Provider of export credits • Financial advisor • Investor outside the Central & Eastern Europe and the CIS countries

  18. EBRD in Romania

  19. Sector Distribution of EBRD Portfolioin Romania € 3.3 billion across more than 190 projects (as per 31.12.2006)

  20. 2006 Portfolio Breakdown State loans 25% Private loans 51% Equity 20%

  21. Success through Partnerships in Romania

  22. Contact Information Serban Ghinescu Deputy Head of Office EBRD Resident Office 8 Orlando Street, Bucharest 1, Romania +40 21 202 7100 ghinescs@ebrd.com Hildegard Gacek Director, Romania EBRD Resident Office 8 Orlando Street, Bucharest 1, Romania +40 21 202 7100 gacekh@ebrd.com www.ebrd.com

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