38086 - GTLP UniCredit

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Summary of Investment Information

Project Number

38086

Company Name

UNICREDIT SPA

Date SPI Disclosed

Mar 23, 2016

Country

World Region

Region

Global

Projected Board Date

May 6, 2016

Environmental Category

FI-3 - No Impact

Status

Completed

Last Updated Date

Jun 12, 2021

Department

Global Trade & Supply Chain

Industry

Financial Markets

Previous Events

Approved : May 27, 2016
Signed : Jun 2, 2017

Sector

Commercial Banking - Trade and Supply Chain

Project Description

The proposed project falls under the Global Trade Liquidity Program (“GTLP”), an innovative and well received trade finance program launched by the International Finance Corporation (“IFC”) in 2009. GTLP provides liquidity or guarantees to global or regional banks with large financial institution networks. Through GTLP, banks are able to grow their credit limits, manage risk, and support trade in the emerging markets.

The proposed project involves establishing a funded risk sharing facility (the “Facility”) with UniCredit SpA (“UniCredit” or the “Bank”) for up to US$500 million to share the risk on a portfolio of emerging market issuing banks.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee	250.0
Loan
Equity

Development Impact

The Facility is expected to have the following development impacts:
- Increased access to finance: The project will increase access to finance for the Emerging Market importers and exporters. Improved availability of credit is expected to benefit local enterprises (producers and importers, including SMEs) along the value chain and therefore support growth, sustain employment, and encourage the generation of higher incomes.
- Strong demonstration effect through partnership with a major international bank and by mobilizing other program participants to support trade finance, the Project will have a strong demonstration effect by encouraging greater local/regional bank participation in EM trade finance thereby increasing access to finance for local importers and exporters.

IFC''s additionality is largely derived from GTLP being an innovative exposure and capital management instrument. The Project will help Unicredit manage/maintain/extend exposure limits for EMIB exposures contemplated by the Project, as well as optimize its capital usage. These factors are allowing for increased trade that the Project is targeting. At the moment, there is no other risk mitigation instrument that has the scope of GTLP that covers over 400 EMIBs with the primary purpose of supporting emerging market trade flow. Without the proposed facility, many of the EMIBs contemplated by the project would not be provided lines solely from the Bank or such EMIBs would have to operate with much reduced limits.
In addition, in the current environment, there is significantly reduced EM risk appetite among investors; however, given the success of the GTLP program and the IFC track record, the project will also be supported by IFC mobilization from private participants.

E&S Category Rationale / Risks and Mitigation

This project has been classified as a category FI-3 project according to the IFC’s Sustainability Policy. The applicable requirements for the project include the IFC’s Exclusion List and other eligibility criteria as established by IFC. Each trade pool will be supported by underlying documentation with the designated bank, and the agreement with UniCredit will specify that the underlying traded goods meet the above applicable requirements and will require the Bank to report on implementation. IFC will also review the details of the underlying trade transactions to confirm their compliance with IFC Exclusion List.

Contacts

For Inquiries About the Project, Contact

Antonio Ebale (mail to: mailto:Antonio.Ebale@unicredit.eu)
Senior Manager
Head of Trade Risk Management & Forfaiting Italy
Global Transaction Banking
Unicredit S.p.A.
Piazza Gae Aulenti
UniCredit Tower – Torre B - Piano 6
20154 Milan, Italy

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Local Access of Project Documentation

Unicredit S.p.A.
Piazza Gae Aulenti
UniCredit Tower – Torre B - Piano 6
20154 Milan, Italy

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This Summary of Investment Information (SII) is prepared by IFC to disclose a factual summary of the main elements of the potential investment. It also includes findings and recommendations related to environmental and social considerations regarding this potential investment. The purpose of the SII is to enhance the transparency of IFC’s activities. For any project documentation or data included or attached herein, whether prepared by the project sponsor or otherwise, authorization has been given for public release by the project sponsor. IFC considers that this SII is of adequate quality for release to the public, but has not necessarily independently verified all of the project information therein. It is distributed in advance of IFC Board of Directors’ consideration and may be periodically updated thereafter. Board dates are estimates only and this document should not be construed as presuming the outcome of the Board Directors’ decision. The following SII is disclosed in accordance with IFC's Access to Information Policy (AIP) that went into effect on January 1, 2012.

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