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Working with Black Sea Trade & Development Bank

Working with Black Sea Trade & Development Bank. VIENNA ECONOMIC FORUM Go South East – Invest in Moldova – Invest in the Region Chisinau Meeting – 20/21 February 2008. BSEC Members - Shareholders of BSTDB. Ukraine. Russia. Moldova. Georgia. Azerbaijan. Romania. Bulgaria. Armenia.

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Working with Black Sea Trade & Development Bank

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  1. Working with Black Sea Trade & Development Bank VIENNA ECONOMIC FORUMGo South East – Invest in Moldova – Invest in the Region Chisinau Meeting– 20/21 February 2008

  2. BSEC Members - Shareholders of BSTDB Ukraine Russia Moldova Georgia Azerbaijan Romania Bulgaria Armenia Albania Turkey Greece

  3. BSTDB objectives • Facilitation of trade and investment activities among Member Countries • Promotion of economic prosperity in Member States and a strong developmental impact • Mobilization of domestic and foreign capital

  4. BSTDB in 2007 • Portfolio (outstanding) – US$ 745*million • Portfolio growth – 64 % ____________________________________________________________________________________________________ • Moldova – US$ 17.4* million (2.35%) • Growth – 3.7 times *- preliminary estimates

  5. BSTDB Products • Project finance • Corporate lending • Asset-based finance • Syndicated loans • Trade finance • Equity investments

  6. BSTDB Lending • Up to US$ 36.6 million BSTDB participation • Up to 35% of the total project costs • Medium to long term maturity depending on type and structure of project • Pricing and grace period subject to appraisal and valuation

  7. Equity • Up to US$ 10 million BSTDB participation • Minority stake (generally less than 25% and not more than 33% of total equity). • No direct participation in company management • Probable seat on the Board of Directors • Possible Put option for BSTDB exit

  8. Why BSTDB? • Stringent but quick approval process • Ability to process “small” projects • Team blending international and local expertise • No political or macroeconomic conditionality attached to the financing

  9. Eligibility Review Concept Clearance Credit Committee Approval Board Approval Disbursement Signing BSTDB Project Cycle

  10. Maturity of BSTDB loans • Typical 2 - 7 years • Possible up to 10 years • In exceptional cases more than 10 years

  11. BSTDB security requirements • Standard pledge of shares, assets, corporate/parent guarantees, etc. depending on the project • In a cross-boarder investment, the security can be based in the country of investment • While possible, sovereign guarantee is not required • Unsecured transactions

  12. What is the minimum project size BSTDB would consider? • Project Size - $10 million • BSTDB participation - $3 million

  13. Weaponry or military goods Tobacco and alcohol related products Negative list of relevant countries Negative list of United Nations economic sanctions Negative list of World Bank Non-Eligible Goods

  14. Eligibility Criteria • last 2 - 3 years financial statements audited by international auditors; • has adopted International Accounting Standards; • have acceptable financial and operational performance,

  15. Thanks from the Banking Division of BSTDB www.bstdb.org

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