MICROCAPITAL BRIEF: Green for Growth Fund Southeast Europe (GGF) Signs $2.2m Senior Loan Facility with ICS Total Leasing & Finance of Moldova

The Green for Growth Fund Southeast Europe (GGF), a Germany-based fund that invests in energy efficiency and renewable energy, recently announced that it has agreed to disburse a senior loan of EUR 2 million (USD 2.2 million) to ICS Total Leasing & Finance S.A. (TLF), a Moldova-based non-banking financial institution. TLF is 25-percent owned by Netherlands-based Emerging Europe Leasing and Finance B.V. and 75-percent owned by Netherlands-based Nederlandsche Financieringsmaatschappij voor Ontwikkelingslanden (FMO).

The funding, which is to be paired with support from GGF’s Technical Assistance Facility, is aimed at enabling TLF to provide energy efficiency solutions, such as improvements of housing envelopes and the replacement of outdated machinery and equipment for small and medium-sized enterprises (SMEs). These improvements are projected to result in energy savings of approximately 16,600 megawatt-hours and carbon dioxide emission reductions of 3,600 tons annually.

Angela Gladei, the General Director of TLF, said: “Bearing in mind that Moldova depends on imported energy resources and, at the same time, given the strong negative impact the traditional energy sector has on the climate change, Total Leasing and Finance sees the future in the energy efficiency products. Therefore, by contracting the facility dedicated to financing EE technologies, our aim is to adhere to the best practices in this sector and encourage our customers to implement energy efficient measures.”

As of December 2013, GGF reported total assets of EUR 242 million (USD 326 million), a gross loan portfolio of EUR 170 million (USD 229 million) and an annual profit of EUR 430,000 (USD 579,000). As of December 2015, TLF’s authorized capital totals MDL 39 million (USD 19.4 million), and the firm reported a gross loan portfolio of EUR 20.4 million (USD 23 million).

By Kevin van den Brink, Research Associate

About the Green for Growth Fund Southeast Europe (GGF)

The Germany-based Green for Growth Fund, Southeast Europe (GGF) focuses on extending the use of renewable energy sources and enhancing energy efficiency in Southeast Europe. GGF finances and refinances energy efficiency initiatives and invests in small to medium-scale renewable energy projects. This includes offering technical support and funding to local financial institutions to fund end-users. GGF was established in 2009 by Germany’s Kreditanstalt für Wiederaufbau (KfW) and the Luxembourg-based European Investment Bank (EIB) with the financial support of the EU’s European Commission, the German Federal Ministry for Economic Cooperation and Development (also known by its German acronym BMZ), and the European Bank for Reconstruction and Development (EBRD). As of 2014, GGF operates in 13 countries: Albania, Armenia, Azerbaijan, Bosnia and Herzegovina, Croatia, FYR Macedonia, Georgia, Kosovo, Moldova, Montenegro, Serbia, Turkey and Ukraine. As of December 2013, GGF reported total assets of EUR 242 million (USD 326 million), a gross loan portfolio of EUR 170 million (USD 229 million) and a an annual profit of EUR 430,000 (USD 579,000).

About ICS Total Leasing & Finance S.A. (TLF)

TLF was founded in 2006 by Netherlands-based Emerging Europe Leasing and Finance (EELF) and the Dutch development bank Nederlandse Financierings-Maatschappij Voor Ontwikkelingslanden (FMO) to provide loan financing to both enterprises as well as individuals in Moldova. In addition to domestic sources, TLF has received funds from seven foreign financial institutions, namely Deutsche Investitions- und Entwicklungsgesellschaft (DEG); FMO; Oikocredit and Black Sea Trade and Development Bank (BSTDB); European Bank for Reconstruction and Development (EBRD); EELF; and responsAbility. Furthermore, TLF obtained funding through collaborations with a number of lenders in Moldova. As of December 2015, TLF’s authorized capital totals MDL 39 million (USD 19.4 million), and it reports a gross loan portfolio of EUR 20.4 million (USD 23 million). As of April 2016, TLF is owned for 25 percent by EELF and for 75 percent by FMO.

Sources and Additional Resources

[1] GGF, News, “GGF Partners With Total Leasing Finance to Support Energy Efficiency Investments in Moldova

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