New EBRD financing to help Turkey establish a low carbon market economy, SEE Energy News
The EBRD is continuing to help Turkey become an energy-efficient and low carbon market economy with a new financing package of €50 million provided toFinansbank for on-lending to private companies investing in renewable energy, industrial energy efficiency and waste-to-energy projects.
The EBRD financing to Finansbank is provided under the EBRD’s €700 million Mid-size Sustainable Energy Financing Facility (MidSEFF) – an important component of the EBRD’s support for Turkey’s long-term energy strategy. Launched in 2010 and subsequently extended in 2011, MidSEFF funding is being closely coordinated with the European Investment Bank (EIB).
The funding is provided through the purchase of notes issued by Bosphorus Financial Services under Finansbank’s established Diversified Payment Rights (DPR) securitisation programme. Importantly, the financing provides Finansbank with 12-year funding which is a longer maturity than is otherwise typically available for on-lending to Turkish clients.
Announcing the deal, Noel Edison, Director for Insurance and Financial Services at the EBRD said: “Green energy is profitable energy. By further securing funding to the private sector we ease the burden of initial investments into energy efficiency that in the long run will considerably lower energy bills for businesses.”
“We are particularly pleased to welcome Finansbank to the group of our partner banks in Turkey that finances sustainable energy projects,” he added.
This new EBRD investment also aims to step up the pace of investment in renewable energy technologies in a move to help Turkey’s energy-intensive economyreduce greenhouse emissions. It will also help bring the environmental standards of enterprises closer to the EBRD and EU best practices, thus raising the bar for their competitors.
Finansbank’s Chairman Ömer Aras said: “We are especially excited to have signed our first cooperation agreement with EBRD and become a part of the MidSEFF programme. This facility stands out as the longest foreign borrowing our bank ever obtained and proves the confidence of EBRD in our institution and therefore has a special place. Also as Finansbank’s first loan for energy financing, I’m confident this facility will enable us to support our customers better in the energy sector while also contributing to the fulfilment of Turkey’s energy strategy.”
Finansbank, a fast-growing and dynamic lender, was established in 1987 and currently operates in 575 branches throughout Turkey. It is the most recent bank to join the EBRD partner banks: Akbank, Denizbank, Garanti, Vakifbank, Isbank and Yapikredi in financing sustainable energy projects in the country.
MidSEFF is supported by a comprehensive technical assistance programme to support the preparation and appraisal of sub-projects and the development of the voluntary carbon market in Turkey. The technical assistance support is funded by the European Union and the EBRD Shareholder Special Fund, in collaboration with the Turkish Treasury.
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