Despite the economic challenges of the COVID-19 pandemic and the Russian invasion of Ukraine, IFC ramped up support for Romanian companies with a record investment of $458 million in fiscal year 2022—between July 2021 and June 2022—to protect jobs, support small businesses, and accelerate a green and resilient recovery.
To help drive the nation’s fight against climate change, IFC invested over RON800 million, approximately $180 million equivalent, in bonds issued by two of the country’s systemic banks—Raiffeisen Bank S.A and Banca Comercială Romana S.A, and whose proceeds will be dedicated to financing green and sustainable projects. In alignment with the banks’ prior issuance of senior non-preferred bonds, these bonds expanded their capitalization, enhancing their stability, as the bonds qualified for the European Union’s Minimum Requirement for own funds and Eligible Liabilities (MREL).
IFC also invested €42.5 million in a €500 million green bond issued by CTP N.V., a sustainable European industrial and logistics property owner-developer. With this funding, IFC aims to promote an energy-efficient real estate sector, fostering greater market sustainability while tackling climate change in Romania.
Given the increased interest in blue finance globally, an emerging area in climate finance, IFC provided its first blue loan in Central and Eastern Europe. IFC’s €100 million loan to Banca Transilvania SA, the largest bank in the country, will help increase funding for blue economy projects in Romania. Blue bonds and blue loans are innovative financing instruments that earmark funds exclusively for ocean-friendly projects and critical clean water resources protection, in areas such as water supply and sanitation, ocean-friendly chemicals and plastic processing, sustainable shipping and port logistics, fisheries and seafood value-chain, offshore renewable energy generation, and others.
Enabling small businesses, including women entrepreneurs, to continue their operations, protect jobs, and speed up the recovery, IFC provided a €10 million loan to Garanti BBVA Leasing Romania, a dynamic financial group in the local market.
IFC is also active in the Venture Capital space in Romania, and has invested $10 million in FintechOS this year, a global technology provider for banks, insurers, and other financial services companies. FintechOS is rapidly becoming a global player and provides an innovative software architecture to accelerate the digitalization of the banking sector worldwide.
“In the midst of higher uncertainty and market volatility, IFC is committed to continue supporting and catalyzing private investment in Romania,” said Ary Naïm, IFC’s Regional Manager for Central and Southeast Europe.” We also see new opportunities and further needs to mobilize private investment, to help bridge Romania’s infrastructure gap in the transportation, renewable energy, waste and water treatment sectors.”
IFC has supported private sector development in Romania for over 30 years, with a committed exposure reaching $1,274 billion as of August 2022.