IFC is implementing or has completed the following projects:
CURRENT PROJECTS
Health Care Public-Private Partnership Advisory Program
2002
Funded by the Government of Switzerland
Since early 2002, IFC has advised Romania’s Ministry of Health on the use of public-private partnerships in public hospitals to improve care for public patients and reduce the government’s financial burden. Through partnerships, upgraded medical care is provided via contractual arrangements with private providers of services and equipment. Patients gain access to high quality service at lower costs, and contractual and regulatory safeguards ensure that care is administered in accordance with international standards. Through a partnership, staff at a major public hospital in Bucharest was able to modernize radiology and laboratory services in order to offset chronic equipment shortages. Via contracts with private suppliers, existing staff was retained to work with upgraded equipment, and the radiology unit has seen a 35% reduction in costs. Other successful programs have included the concession of a private wing in Bucharest’s main maternity hospital, and outpatient dialysis services in two locations. Future partnership programs will address the need for day surgery services, home health care, and various outpatient services. The PPP advisory program is part of a broader health care reform program suggested to the Government of Romania by IFC that includes reforms in legal and regulatory framework, provider payment arrangements, hospital management, and provider accreditation and regulation.
The Secondary Market Legislative Project
2003
Funded by the Government of Canada
The program was designed to carry out an assessment of the current legislative framework and provide guidance on how to improve it in order to allow the appropriate development of the Mortgage Bonds and MBS markets. The “Securitization and Mortgage Bond Regulatory Package” was submitted to Parliament in January of 2004. Advisory services experts will also design an appropriate legal structure for mortgage bonds and securitization under the current Romanian legal system that covers i) the various European mortgage bond markets and securitization systems and ii) the need to harmonize with other countries in the region, and in particular Bulgaria.
COMPLETED PROJECTS
Capacity Building Technical Assistance to Banca Romaneasca
1999 - 2003
Funded by the Government of Netherlands
An important step to developing a strong small and medium enterprise (SME) sector in Romania is to strengthen the financial intermediaries that serve it. Banca Romaneasca (BROM) is a small, second-tier bank with an SME client base that required technical assistance to make it competitive, safe and sustainable. IFC stepped in and designed a capacity building program for BROM to meet the dual objectives of financial sector institution building and SME sector growth. Funded by the Netherlands, the program included intense training through sustained on-site assistance from an international Dutch bank in strategic and tactical planning, corporate governance, credit risk management, financial management, risk management (including liquidity, interest rates, maturity, duration and foreign exchange), human resource management, compliance and control systems, and information technology. The program was successful, particularly in the area of strengthening BROM staff’s ability to assess sub-loans to SME’s, and in-house training programs in various disciplines continue to be offered by BROM management. At the end of 2003, BROM was acquired by National Bank of Greece at very favorable terms as part of its strategy to penetrate the Romanian banking market.
Privatization of Bucharest Water and Sanitation Services
1998 – 2000
Funded by the Government of Japan
In its ongoing efforts to foster private sector growth and help liberalize the Romanian economy, IFC began supporting the Government’s efforts to privatize the Water and Sewerage company of Bucharest, Regia Generala de Apa Bucuresti (RGAB) in the late 1990’s. The water system had been troubled by a high amount of non-revenue producing water as a result of leaks in the distribution network, wastage, defective taps, and inaccurate metering of consumption. The government and the municipal-owned utility, RGAB, was unable to provide adequate financial resources to turn around its operations, nor did it have the legal expertise to undertake a privatization transaction that would gain the confidence of international strategic investors. RGAB was also challenged by the need to design a sustainable project that would balance public vs. private interests. IFC designed an advisory program to assist in upgrading the financial management, quality control, organization restructuring and general planning of RGAB to meet western standards. The program also helped RGAB increase organizational efficiency and operational performance by providing reliable information on the technical, legal, economic, and market environments. Finally, IFC provided expert legal support to the privatization transaction to satisfy potential bidders and at the same time protect the interest of consumers.
Training for Senior Management of Local Insurance Company
Funded by the Government of Sweden
2000-2002
IFC helped local insurer, Garanta, to convert from local to international accounting standards. This conversion introduced a more accurate assessment of local insurance sector activity because companies who adopt it will be required to report their earnings using a standardized format, providing consumers and investors a more accurate picture of their financial strength. The TA program also produced a business plan for Garanta to help it better position itself in an increasingly consolidated market.
