Bank loan

FIF – EaP SMEC – Bank loan TBC II






Project description

Senior unsecured loan in the amount of up to USD 20 million equivalent in GEL to be provided to TBC Bank to support investment financing of micro, small and medium enterprises (“MSMEs”) in Georgia and promote standards in the market under the Eastern Partnership SME Competitiveness Program (“EaP SMEC”), successor to the DCFTA programme, for sustainable investments in technology and equipment.



the project’s objectives

The project will enable the bank to finance medium and long-term investments of Georgian MSMEs in upgrading their technologies and equipment needed to meet EU standards in terms of product quality, health and safety measures. safety and environmental protection, thus improving their competitiveness at local and regional level. The project aims to provide at least 75% of sub-loans consistent with the EBRD’s Green Economy Transition (GET) approach.




Impact of transition


ETI rating: 75



Competitive: the program will encourage the early adoption by SMEs of stricter European standards and their compliance. It is also intended to contribute to the technical capacity of the TBC bank and to provide business advice to SMEs in areas related to the DCFTA.

Resilient: the program promotes resilience by maintaining adequate portfolio quality of partner financial institutions.





Customer information


TBC BANK JSC



TBC Bank (“TBC”) is a leading universal bank in Georgia, holding more than one-third market share in total banking assets, loan and deposit portfolios in Georgia. It offers a wide range of services (including foreign exchange transactions, non-financial services to support business development, as well as leasing, brokerage and investment banking through its subsidiaries) to its retail clients, companies and MSMEs thanks to its vast distribution network of up to 160 agencies and digital channels.





EBRD Financial Summary





$20,000,000.00






Total project cost




$20,000,000.00






Additionality

The main sources of additionality under the project are:

(i) Financing structure that is not available on the market (medium and long term financing in local currency);

(ii) Innovative financing structure (green finance instrument that integrates climate and ESG considerations into the financing structure);

(iii) knowledge, innovation and capacity building (technical assistance under the program will support timely delivery of EU-compliant investments in Georgia); and

(iv) Use of EBRD expertise to achieve higher gender standards and/or equal opportunity action plans by introducing gender bias training for lending staff and representatives of ESG ambassadors, employees of the ESG department, credit analysts and risk managers from TBC Bank.




Environmental and social summary

FI rated (ESP 2019). TBC Bank is a long-standing EBRD client and compliance with and reporting on Bank requirements has been satisfactory in the context of existing and past projects.




Technical cooperation and grant financing

The EaP SME Competitiveness Sub-Operation will be complemented by grants (TC and non-TC) from the EU under the Delegation Agreement between the EBRD and the European Commission for the SME Competitiveness Program in the Partnership eastern:

(i) A project consultant under the EaP SMEC program will assist TBC in implementing the installation. A separate Verification Consultant (VC) will be engaged to verify the technical implementation of the sub-projects before the investment incentives are granted to the concerned MSMEs.

(ii) The project is supported by investment incentives of up to $2.88 million for TBC sub-borrowers, calculated for each sub-project at up to 15% of the lower amount between ( (i) the disbursed amount of the sub-loan, and (ii) the investment cost of the sub-project concerned, and

(iii) 50% of the senior unsecured loan will benefit from first loss risk coverage (FLRC) under the SME LCY program provided by the Special Local Currency Risk Sharing Fund for SMEs.




Company details

Ketevan Bitskinashvili
[email protected]
+(995 32) 227 27 27
https://tbcbankgroup.com/
7 Marjanishvili St. Tbilisi, Georgia 0102




Implementation Summary





PSD latest update




August 04, 2022























Understanding Transition

More information on the EBRD’s approach to measuring transition impact is available here.

Professional opportunities

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General Information

Specific requests can be made using the EBRD’s inquiry form.

Environmental and Social Policy (ESP)

The ESP and associated performance requirements (PRs) set out how the EBRD implements its commitment to promote “sustainable and environmentally responsible development”. The PSE and PRs include specific provisions for clients to comply with applicable requirements of national public information and consultation laws as well as establishing a grievance mechanism to receive and facilitate the resolution of concerns. and stakeholder grievances, particularly regarding the environmental and social performance of the client and the project. Proportionate to the nature and magnitude of a project’s environmental and social risks and impacts, the EBRD further requires its clients to disclose information, as appropriate, on the risks and impacts arising from the projects. or that they undertake extensive consultations with stakeholders and consider and respond to their feedback.

Further information on the EBRD’s practices in this regard can be found in the ESP.

Integrity and Compliance

The EBRD’s Office of the Chief Compliance Officer (OCCO) promotes good governance and ensures that the highest standards of integrity are applied to all Bank activities in accordance with international best practices. Integrity due diligence is performed on all Bank clients to ensure that projects do not pose unacceptable risks to the integrity or reputation of the Bank. The Bank believes that identifying and resolving issues during the approval stages of project appraisal is the most effective way to ensure the integrity of Bank transactions. OCCO plays a key role in these safeguarding efforts and also helps monitor integrity risks in projects after investment.

OCCO is also responsible for investigating allegations of fraud, corruption and misconduct in EBRD-financed projects. Anyone, inside or outside the Bank, who suspects fraud or corruption should submit a written report to the Chief Compliance Officer by email at [email protected] All reported issues will be handled by OCCO for follow-up. All reports, including anonymous reports, will be investigated. Reports can be written in any language of the Bank or of the Bank’s countries of operations. The information provided must be made in good faith.

Access to Information Policy (AIP)

The AIP sets out how the EBRD discloses information and consults with its stakeholders in order to promote a better knowledge and understanding of its strategies, policies and operations after its entry into force on January 1, 2020. Please see the Access Policy page to the information to find out more. what information is available on the EBRD website.

Specific inquiries can be made using the EBRD’s inquiry form.

Independent Project Accountability Mechanism (IPAM)

If efforts to address environmental, social or public disclosure concerns with the client or the Bank are unsuccessful (for example through the client’s project-level grievance mechanism or through direct engagement with Bank management), individuals and organizations can seek to address their concerns through the Independent Project Accountability Mechanism (IPAM).

IPAM independently investigates project issues that are suspected of causing (or likely to cause) harm. The objective of the mechanism is to: support dialogue between project stakeholders to resolve environmental, social and public disclosure issues; determine whether the Bank has complied with its environmental and social policy or the project-specific provisions of its access to information policy; and, where appropriate, to remedy any existing non-compliance with these policies, while preventing any future non-compliance on the part of the Bank.

Please visit the Independent Project Accountability Mechanism webpage to learn more about IPAM and its mandate; how to submit a request for review; or contact IPAM by email [email protected] for advice and more information about IPAM and how to submit an application.