Authorizations and exposure

• EBRD loans to private sector projects range from EUR 3 million to EUR 250 million; the average amount is EUR 25 million
• EBRD supports local commercial banks, which in turn provide loans to SMEs and municipalities. Tools that may be available include credit lines, bank-to-bank loans, standby credit facilities and equity investments in the local banks
• Basis for a loan is the expected cash flow of the project and the ability of the client to repay the loan over the agreed period
• Fixed or floating-rate: Fixed-rate basis linked to a floating rate such as LIBOR; floating-rate basis with a cap or a collar
• Senior, subordinated, mezzanine, or convertible debt
• Denominated in major foreign or local currencies
• Short- to long-term maturities up to 10 years
• Project-specific grace periods may be incorporated
• Fees:
• Front-end commission (paid upfront)
• Commitment fee (payable on the committed but undisbursed loan amount)
• Prepayment: Cancellation and late payment fees are also charged if necessary
• Other lending terms:
• Recourse to a sponsor is not required, however, the EBRD may seek specific performance and completion guarantees plus other forms of support from sponsors typically found in limited-recourse financing
• EBRD requires project companies to obtain insurance against normally insurable risks, but does not require insurance against political risk or local currency inconvertibility
• Financed companies are usually required to secure the loan with project assets
• Typical project finance covenants are required as part of the loan package
• Loan repayments are normally in equal, semi-annual installments, though longer maturities may be considered on an exceptional basis (e.g., up to 15 years for large infrastructure operations)
• EBRD can help manage financial risks associated with a project’s assets and liabilities, which covers foreign exchange risk, interest rate risk, and commodity price risk

• EBRD invests equity ranging from EUR 2 million to EUR 200 million in private sector projects; it expects a market rate return from its equity investments and only invests in minority equity positions
• Equity and quasi-equity investments include ordinary shares, preference shares, subordinated loans, redeemable preference shares, listed and unlisted, underwriting of share issues by public or privately-owned enterprises, and other forms can be discussed with EBRD banking staff
• EBRD also participates in private equity funds that focus on a specific region, country, or industry sector, have local presences, and are run by professional venture capitalists

• Guarantees:
• Letters of credit and standby letters of credit from the issuing bank
• Deferred payment and “red-clause” letters of credit
• Advance payment guarantees and bonds, and other payment guarantees
• Bills of exchange and trade-related promissory notes
• Bid bonds, performance bonds, and other contract guarantees
• Longer tenors are approved (where appropriate) to cover finance of imported capital equipment and for other term guarantees
• Other types of trade finance instruments can also be considered
• Revolving credit facility:
• EBRD can also extend short-term loans to selected banks and factoring companies
• Exclusively for the purpose of pre- and post-shipment finance and other financing of working capital necessary for the performance of foreign trade contracts and domestic and international factoring operations
• EBRD can provide financing for domestic factoring activities, in local currencies in a number of countries

• Under its Small Business Initiative, the EBRD also helps small and medium-sized businesses access the business advice they need to grow, succeed, then grow again, becoming genuine catalysts for their local economies and region

• Project must be in EBRD country of operation

• Project cannot be connected to defense-related activities, tobacco, substances banned by international law or gambling facilities

• EBRD performs extensive due diligence including:

• EBRD does not provide subsidies, sponsorship or donations
• Integrity due diligence and beneficial ownership verification
• Financial due diligence
• Market due diligence
• Management due diligence
• Technical /operational due diligence
• Legal due diligence
• Environmental and Social due diligence
• Procurement due diligence

• EBRD increased its paid-in capital by EUR 4 billion to help provide significant and sustained investment for Ukraine’s real economy

• EBRD is a climate finance leader and now aims to become a majority green bank by 2025

• 2024: EBRD approves membership of Ghana and Senegal

• 2024: EBRD promotes green lending under KyrSEFF III

• 2024: EBRD approves new country strategy for Uzbekistan

• 2024: EBRD deploys a record €2.1 billion in Ukraine in 2023