Original disclosure @ EBRD website
Updated in EWS Oct 28, 2022
Disclosed by Bank Oct 13, 2022
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The provision of a senior synthetic Kyrgyz Som (KGS) loan of up to US$ 5 million to Kompanion Bank (KB) under the Kyrgyz Republic GEFF (KyrSEFF III ). The proceeds will be on-lent to sub-borrowers for energy efficiency, renewable energy, circular economy, and climate resilience investments. The project will further strengthen SME competitiveness, improve climate resilience and promote the financial sector development in particular through local currency lending.
The transaction will contribute towards building a more competitive financial sector through developing the internal capacity of KB for financing energy and water efficiency projects. This will be achieved through a technical assistance aimed at providing implementation support to KB and their customers, verification of the outcomes, and investment incentives to end borrowers. Sub-projects are selected according to technical and financial eligibility criteria set forth in the policy statement for KyrSEFF III. 100 per cent of the proceeds will be used for Green Economy Transition investments.
The project will contribute towards building a green economy by facilitating the expansion of energy/water efficiency lending to residential and commercial sectors in the Kyrgyz Republic and positive demonstration effects of energy/water efficiency projects.
KOMPANION BANK CJSC
Kompanion Bank is an existing client since 2007 and a major SME lender in the Kyrgyz Republic. KB maintains a strong market presence with 8th ranking by loan portfolio and 9th by total assets among 23 commercial banks in the country. The bank is majority-owned by Mercy Corps (USA).
EBRD FINANCE SUMMARY
Synthetic KGS senior loan of up to US$ 5 million equivalent for on-lending to eligible private micro, small and medium-sized enterpreneurs (MSMEs) for financing GET Investments. The tenor will be 3 years including a 1 year grace period.
TOTAL PROJECT COST
Additionality will be achieved through a combination of: (i) much-needed medium-term financing in local currency; (ii) innovative financing structure and instruments, (iii) standard-setting and (iv) knowledge, innovation and capacity building.
Gender additionality is expected to be achieved by building the capacity of the company in gender-responsive green lending in addition to supporting equal access to green finance for women and men.
ENVIRONMENTAL AND SOCIAL SUMMARY
Category FI (2019 ESP). Kompanion Bank is a long-standing client of the Bank that has been performing well in terms of applying the Bank's PRs and reporting in a timely fashion. The client will continue to apply PRs 2 and 4 to their internal operations and PR9, coupled with the E&S Procedure for Corporate SME and Micro Loans. Under the 2019 policy, the client will require to take note of the Referral List and liaise with the EBRD in any transactions involving activities on that list, and also take note of the updated E&S Exclusion List. Any investments in renewable energy will be required to follow the Bank's procedures and guidance for such sub-projects. The EBRD funding may be used for financing solar PV technologies. Such sub-projects will be managed in line with 'The Proposed Management Approach for Solar Supply Chain Risk Management' (CS/FO/21-35) and any subsequent guidance developed under that approach.
TECHNICAL COOPERATION AND GRANT FINANCING
Kompanion Bank will continue to receive support from Facility Consultant under KyrSEFF III TC Programme in matters of marketing, project origination and preparation, overall successful management and implementation of the Facility, in a gender-responsive way.
Funding source: Shareholder Special Fund and potentially other donors.
COMPANY CONTACT INFORMATION
Saltanat Dzhantemirovahttps://www.kompanion.kg/62, Shota Rustaveli
St.,720044, Bishkek, Kyrgyzstan
Project contacts not available at the time of disclosure.
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The Project Complaint Mechanism (PCM) is the independent complaint mechanism and fact-finding body for people who have been or are likely to be adversely affected by an European Bank for Reconstruction and Development (EBRD)-financed project. If you submit a complaint to the PCM, it may assess compliance with EBRD's own policies and procedures to prevent harm to the environment or communities or it may assist you in resolving the problem that led to the complaint through a dialogue with those implementing the project. Additionally, the PCM has the authority to recommend a project be suspended in the event that harm is imminent.
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