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| Summary of Project Information (SPI) |
| This Summary of Project Information is prepared and distributed to the public in advance of the IFC Board of Directors’ consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC’s activities, and this document should not be construed as presuming the outcome of the Board decision. Board dates are estimates only. |
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| Project number | 24230 |
| Project name | Hypo Vereinsbank - Serbia & Montenegro |
| Country | Serbia and Montenegro |
| Sector | Finance & Insurance |
| Department | Global Financial Markets Group |
| Company name | Unicredit Bank Srbija A.D. |
| Environmental category | FI-1 |
| Date SPI disclosed | May 10, 2005 |
| Projected board date | June 10, 2005 |
| Status | Active |
| Previous Events | Invested: March 1, 2006
Signed: June 30, 2005
Approved: June 27, 2005 |
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| Description of company and purpose of project |
The proposed investment would enable HVB Bank Serbia and Montenegro (HVB, the bank or the company) to address its long-term funding needs including the areas of mortgages and SMEs. Current term loans in the Serbian market have typical tenures of three to four years. The Bank therefore has approached IFC for funding with longer tenor to be able to expand its long-term lending.
HVB Bank Serbia and Montenegro a.d. was established in 2001. The Bank is a member of the HVB Group through Bank Austria Creditanstalt (BA-CA). BA-CA owns 99% of the shareholding of the Bank. It is being geared by BA-CA to become a universal bank offering a variety of products. As of December 2004, it had total assets of EUR202 million, shareholders’ equity of EUR21 million, and total liabilities of EUR181 million of which deposits totaled EUR133 million. For the year 2004 its ROAE and ROAA were 23% and 2.5% respectively. |
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| Project sponsor and major shareholders of project company |
| The Sponsor, Bank Austria Creditanstalt, is a member of HVB Group, Germany. HVB is the second-largest banking group in Germany, with the majority of its shares publicly traded. It is rated A- by S&P. HVB offers a full range of banking services to retail and corporate customers and has a network of some 2,100 branches of which around 950 are located in Germany and 400 in Austria. As of December 2004, HVB’s total assets were EUR467 billion and shareholders’ equity was EUR11.5 billion. |
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| Total project cost and proposed IFC investment |
| The proposed IFC investment is a senior loan of up to EUR30 million for IFC’s own account. |
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| Location of project and description of site |
| Belgrade, Serbia and Montenegro |
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| Project Development Impact and IFC's Role |
IFC has a number of important roles in this project:
- First, its investment would strengthen and expand the long-term financing capacity of HVB Bank, including in the areas of mortgages and SME lending.
- Second, its involvement at this particular time would enable HVB Bank to further diversify its funding base.
- Third, this project would signal a strong demonstration effect in a fast-changing financial sector environment in a frontier country in which IFC’s presence has great value added.
- Fourth, the loan will help develop a primary mortgage market in Serbia through the availability of long-term financing.
This project has some important developmental benefits:
- It is expected to address the lack of long-term funding, particularly for mortgages and SMEs, and therefore contribute to the growth of these sectors and the economy in general; and
- As one of IFC’s first financial sector investment in Serbia (outside of microfinance) since the beginning of the war in 1991, the project is expected to increase confidence in the country’s financial sector. |
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| Environmental and social issues - Category FI-1 |
This is a category FI type 1 project according to IFC's Environmental and Social Review Procedure. HVB will be required to designate individuals to have responsibility for environmental issues and who will attend environmental training; submit to IFC an environmental management plan; establish an environmental management system to ensure that activities financed under relevant operations are consistent with applicable environmental, health and safety standards of Serbia and IFC's microfinance exclusion list; and submit to IFC annual environmental performance reports.
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| To contact the project company, please write to: |
Mr. Alexander Picker
HVB Bank Serbia and Montenegro a.d.,
Rajiceva 27-29,
11000 Beograd, Serbia and Montenegro
Tel: 381-11-3204-501 |
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