42872 - Akbank Impact Region

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Summary of Investment Information

Project Number

42872

Company Name

AKBANK TURK ANONIM SIRKETI

Date SPI Disclosed

Aug 3, 2023

Country

Turkiye

Region

Central Asia and Turkiye

Projected Board Date

Sep 19, 2023

Environmental Category

FI-2 - Limited

Status

Completed

Last Updated Date

Apr 10, 2025

Department

CF5IS - Regional Industry FIG MCT/FIG MCT Investment Services

Industry

Financial Markets

Previous Events

Approved : Sep 19, 2019
Signed : Nov 10, 2021
Invested : Nov 17, 2021

Sector

Commercial Banking - General

Project Description

The proposed financing package involves an up to US$50 million senior loan from IFC’s own accounts to Akbank T.A.S. (“Akbank”, the “Bank”), which is a systematically important Turkish bank headquartered in Istanbul.

The tenor of the financing package is 3-year plus 1-week and proceeds of the investment will be used to support MSMEs located in the southeastern provinces of Turkey – those that are most affected by the influx of Syrians under Temporary Protection (“SuTP”) – with the aim to contribute to the sustainable development of the country.

Associated Advisory Engagement

No advisory engagement with the proposed investment.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	140.0
Equity

Development Impact

1. Increased access to finance for MSMEs: The proposed investment will increase access to finance to MSMEs with a special focus on regions that are the most affected by the SuTP influx. 2. Inclusiveness: IFC anticipates that the investment will foster financial inclusiveness by demonstrating to other industry players the positive impact and commercial viability of expanding credit in less developed regions.

1. Financing structure: The proposed investment will avail funding with 3-year plus 1-week tenor, a maturity profile that is not readily available in the Turkish market. IFC anticipates that provision of long-term funds will facilitate MSMEs' reach long-term financing, which will eventually lead to expansion of production capacity and increase in employment; 2. Non-commercial risk mitigation: IFC anticipates that its countercyclical role and continued commitment in the systematically important banks, especially at a time of heightened risks and volatility, will send a signal of confidence to other key investors.

E&S Category Rationale / Risks and Mitigation

The Project aims to support Akbank to increase MSMEs access to financing in the 22 refugee-hosting provinces of Turkey. The key sectors in Akbank’s MSME portfolio are low-medium risk activities such as manufacturing industries, trade and distribution, and construction. The Project will not support coal-related and higher risk activities involving a) involuntary resettlement, b) risk of adverse impacts on Indigenous Peoples, c) significant risks to or impacts on the environment, community health and safety, biodiversity, cultural heritage or d) significant occupational health and safety risks. The Project has been categorized as FI-2 in accordance with IFC’s Sustainability Policy. According to the nature of IFC's investment and the Bank’s operations, the applicable E&S requirements for this investment will be IFC Exclusion List and the national environmental and social laws and regulations. In addition, the Bank will be in line with the IFC’s requirements on Life and Fire Safety (LFS) and Performance Standard 2 on Labor and Working conditions.

The main E&S risks emanate from Akbank’s on-lending activities and its capacity and systems in place to manage these risks. As an existing IFC’s client Akbank has established an ESMS in line with applicable requirements being the IFC Exclusion list, and host-country laws and regulation. The ESMS outlines the procedures, tools, and responsibilities for undertaking E&S risk management of lending activities for the MSME asset class. Akbank has designated an E&S team responsible for implementing the ESMS. Under this Project, the bank will be required to ensure that E&S risks specific to refugee-hosting provinces are properly identified and managed while continuing on retaining proper capacity and providing regular training programs to relevant staff. In line with its commitment Akbank will continue managing HR and labor related issues in line with requirements of LFS and IFC Performance Standard 2 Labor and Working Conditions.

Contacts

For Inquiries About the Project, Contact

Akbank T.A.S.
Mustafa Altug Ülker
International Banking Division Foreign Borrowings Vice President
+90 (212) 385 6238
Altug.Ulker@akbank.com
Akbank Genel Müdürlügü Sabanci Center 4. Levent 34330 Istanbul Turkey
https://www.akbank.com/en-us/Pages/default.aspx

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IFC supports its clients in addressing environmental and social issues arising from their business activities by requiring its real sector clients to set up and administer appropriate grievance mechanisms and/or procedures to address complaints from Affected Communities in relation to environmental and social issues arising from IFC's clients' business activities. Since 2012, IFC's Financial Intermediary clients applying the Performance Standards are required to develop External Communications Mechanisms to receive and review inquiries or complaints from any interested party regarding the E&S risks and impacts of their operations.

For IFC projects that are active or under consideration, individual(s), or their authorized representative(s), who allege they have been or will be adversely affected by E&S risks or impacts arising from IFC's clients' business activities, may submit a complaint to IFC directly for consideration. When receiving an E&S complaint, IFC engages with complainants and works with its clients to find solutions to E&S concerns as quickly and efficiently as possible.

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Affected communities have unrestricted access to the Compliance Advisor Ombudsman (CAO), the independent accountability mechanism for IFC and MIGA. CAO facilitates the resolution of complaints related to IFC and MIGA projects and sub-projects, undertakes reviews of IFC’s and MIGA’s environmental and social compliance, fosters public accountability for their commitments, and enhances the environmental and social performance of IFC and MIGA.

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CAO receives and addresses complaints in accordance with the CAO Policy, which can be accessed at: https://www.cao-ombudsman.org/policies-guidelines.

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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Task Title & Description	Anticipated Completion Date
ESMS Implementation and implementation records	04/10/2022

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