The European Bank for Reconstruction and Development (EBRD), a UK-based multilateral development finance institution, is “supporting Turkey’s transition to an environmentally sustainable, low-carbon and climate-resilient economy” through the Green Economy Financial Facility (GEFF) Turkey. The loan package comprises funds from EBRD’s own resources as well as concessional financing from the Clean Technology Fund, a partnership among EBRD and four other development banks that is active in Africa, Eurasia and Latin America.
GEFF Turkey’s first investment is a credit line of EUR 53.5 million (USD 56.2 million) in favor of Turkiye Sinai Kalkinma Bankasi (TSKB), a Turkish development bank, for it to increase its lending to companies to adopt more environmentally sustainable practices. EBRD also will provide TSKB with a technical assistance package that Arvid Tuerkner, EBRD Managing Director for Turkey, said is meant “to improve Turkish financial institutions’ corporate climate governance practices and to increase the sustainability of their operations.”
Established in 1950, TSKB serves businesses of all sizes. The institution reports total assets of TRY 84 billion (USD 5.7 billion) as of December 2021 with 12-month return on equity of 17 percent and return on assets of 1.6 percent.
Founded in 1991, EBRD seeks to support a “transition to open, market economies, whilst fostering sustainable and inclusive growth” in 38 countries in Central Asia, Eastern Europe and North Africa. It does this by providing business advice, supporting trade finance, and investing debt and equity in funders of micro-, small and medium-sized enterprises. With a focus on “the promotion of private and entrepreneurial initiative,” the bank disbursed approximately EUR 11 billion (USD 13.3 billion) to 411 projects during 2020. EBRD operates separate GEFFs in 29 countries. The institution’s shareholders comprise 69 countries plus the EU.
By Sheen Gupta, Research Associate
Sources and Additional Resources
EBRD press release
https://www.ebrd.com/news/2022/ebrds-first-investment-under-new-green-financing-facility-in-turkey.html
EBRD homepage
https://www.ebrd.com
EBRD GEFF homepage
https://ebrdgeff.com/
TSKB homepage
https://www.tskb.com.tr/
TSKB 2021 annual report
https://en.tskb.com.tr/en/investor-relations/financial-information
Clean Technology Fund description
https://www.climateinvestmentfunds.org/topics/clean-technologies
Previous MicroCapital article on EBRD
https://www.microcapital.org/microcapital-brief-ebrd-moves-to-block-russia-belarus-from-funding-technical-assistance-boost-financing-in-ukraine/
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