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According to the AIIB, the objective of the project is to support Turkiye's resilient recovery and climate transition through financing for green and inclusive post-earthquake housing and climate-aligned small and medium enterprise investments, delivered via a sovereign-backed facility implemented by VakifBank.
The investment consists of a sovereign-backed multi-sector on-lending facility of up to USD300 million to Turkiye Vakiflar Bankasi T.A.O. (VakifBank) (the Facility) with two components:
(i) Component A: Post-earthquake reconstruction, Affordable Housing and Social Infrastructure, and
(ii) Component B: Climate Finance.
Component A consists of a loan of up to USD200 million to support Turkiye's post-earthquake reconstruction efforts through the financing of affordable residential housing and social infrastructure facilities in 11 regions affected by the 2023 disaster. Affordable housing will benefit low-income families and households and in compliance with standards for earthquake resilience and structural integrity set by the Housing Development Administration of Turkiye (Toplu Konut Idaresi Baskanligi, or TOKI). Residential buildings financed from the proceeds of the facility will conform to the standards of green affordable housing under the relevant energy performance certifications. The loan will also support the construction of social infrastructure such as educational facilities and healthcare facilities, with emphasis on low-income areas and underserved groups. The buildings conform to standards of earthquake and climate resilience and energy efficiency and promote the introduction of digitalization to the health and educational services.
Component B consists of a loan of up to USD 100 million to support climate mitigation and adaptation investments by the private sector, specifically small and medium enterprises (SMEs), according to a definition to be agreed between the Borrower and the Bank. Eligible investments may include renewable energy generation, battery energy storage systems (BESS), as well as demand-side solutions that reduce the consumption and waste of energy in buildings. Adaptation investments will enhance the resilience and resource efficiency of production processes, equipment, buildings and infrastructure. The facility will include investments that promote environmental sustainability and mitigate impacts.
As stated by the AIIB, the Project is placed in Category FI, as the financing structure involves the provision of funds to VakifBank pursuant to which AIIB delegates the decision-making related to the use of the AIIB's funds insofar as the subprojects meet the conditions of the Project Operations Manual (POM). This will include the selection, appraisal, approval, and monitoring of subprojects in accordance with AIIB's ESP requirements. Category A as well as Higher Risk activities are excluded from the proposed subproject.
As stated by the AIIB, VakifBank is a prominent Turkish bank established in 1954 with the mission of utilizing the foundation (vakif)'s assets to contribute to Turkiye's economic development. The bank's ownership structure includes 74.79% held by the Turkiye Wealth Fund (Group D), 14.75% by the Republic of Turkiye Ministry of Treasury and Finance (Group A and B), 4.06% by the VakifBank Pension Fund (Group C), and the remaining 6.35% as free float (Group D). Headquartered in Istanbul, VakifBank operates a network of branches across Turkiye, providing a comprehensive range of services including corporate, commercial, and retail banking, as well as investment and private banking services. The bank also has international branches in New York, Bahrain, Erbil, and Qatar, extending its services globally. As of March 31, 2025, VakifBank reported total assets of approximately TL 4.2 trillion (around USD 260 billion), total loans of TL 3 trillion (USD 186 billion), and net income of TL 20.03 billion (USD 1.24 billion) for the first quarter. VakifBank is Turkiye's second-largest bank by total assets and continues to play a central role in supporting the country's economic development and sustainability goals.
AIIB Team Leader:
Francisco Fortuny - Senior Investment Officer
Email: fj.fortuny@aiib.org
Financial Intermediary - Türkiye Vakiflar Bankasi T.A.O. (VakifBank):
Ali Tahan - Senior Vice President
Email: Ali.TAHAN@vakifbank.com.tr
ACCESS TO INFORMATION
You can submit an information request for project information at: https://www.aiib.org/en/contact/information-request/index.html
ACCOUNTABILITY MECHANISM OF AIIB
The AIIB has established the Accountability Mechanism for Project-Affected People (PPM). The PPM provides Òan opportunity for an independent and impartial review of submissions from Project-affected people who believe they have been or are likely to be adversely affected by AIIBÕs failure to implement the ESP in situations when their concerns cannot be addressed satisfactorily through Project level GRMs or AIIB Management processes.Ó Two or more project-affected people can file a complaint. Under the current AIIB policy, when the bank co-finances a project with another development bank, it may apply the other bank's standards. You can refer to the Project Summary Information document to find out which standards apply. You can learn more about the PPM and how to file a complaint at: https://www.aiib.org/en/about-aiib/who-we-are/project-affected-peoples-mechanism/how-we-assist-you/index.html
The complaint submission form can be accessed in Arabic, Bahasa Indonesia, Bengali, Chinese, English, Tagalog, Hindi, Nepali, Russian, Turkish, or Urdu. The submission form can be found at: https://www.aiib.org/en/about-aiib/who-we-are/project-affected-peoples-mechanism/submission/index.html