44973 - WCS COVID GLR

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Summary of Investment Information

Project Number

44973

Company Name

MOTORACTIVE IFN SA

Date SPI Disclosed

Jun 7, 2021

Country

Romania

Region

Europe

Projected Board Date

Jun 15, 2021

Environmental Category

FI-2 - Limited

Status

Completed

Last Updated Date

Sep 22, 2023

Department

Regional Industry - FIG - ECA

Industry

Financial Markets

Previous Events

Approved : Jun 9, 2021
Signed : Jul 19, 2021
Invested : Jul 23, 2021

Sector

Commercial Banking - Trade and Supply Chain

Additional Project Attributes

Blended Finance

Project Description

The proposed investment consists of a one-year, renewable senior loan of up to EUR10 million to Motoractive IFN SA, (operating as Garanti BBVA Leasing Romania) (“GLR”, or the “Company”) under the FIG COVID-19 Emergency Response WCS Envelope (WCS Envelope). The WCS Envelope is designed to provide funding to existing IFC clients in emerging markets that will then extend new loans to companies whose cash flows have been disrupted by the global outbreak of the coronavirus pandemic.

The purpose of the proposed IFC investment is to provide short-term liquidity support to GLR in order to support/expand its lending program to Romanian small and medium enterprises (“SMEs”), with a minimum 40% of the proceeds used to finance women and women-owned businesses that are impacted by the crisis (the “Project”).

Associated Advisory Engagement

N/A

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	12.19
Equity

IFC's loan to the financial institution described in this SII is targeted for on-lending to the following sector(s):

Product Type	Use of Proceeds
Straight Senior Loan	Loans to SME Borrowers
Straight Senior Loan	Loans to Woman-Owned SMEs

IFC's Definitions of Targeted Sectors can be found here.

Development Impact

By supporting its clients' capacity to sustain operations during the shock resulting from COVID-19, IFC is well positioned to support the private sector in its economic recovery process, shortening the time it will take for the most vulnerable to return to their traditional income-earning opportunities. Specifically, this project intends to provide liquidity to the Company, which will then on lend to SMEs, women customers and women owned SMEs.

Additionality is driven by IFC's counter-cyclical role during crises, especially at a time when other lending institutions or investors' appetite may be subdued. IFC's additionality arises from its unique ability to deploy at scale, in terms of volume as well as geographic reach, through its (i) successful experience in rapid crisis response and (ii) extensive client bank and partner networks.

E&S Category Rationale / Risks and Mitigation

The Project has been categorized as FI-2 in accordance with IFC's Sustainability Policy. GLR's financial leasing activities entail low or medium adverse environmental or social (E&S) risks and/or impacts, such as, transport, service, commerce, construction, horeca&tourism which are expected to have potential limited adverse E&S risks or potential impacts that are few in number, generally site specific, largely reversible, and can be readily addressed through mitigation measures. Given the nature of this investment, the Project will not be used to support any coal-related activities, and higher risk business activities that may include: 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. For this Project, GLR will be required to continue implementation of its existing environmental and social management system (ESMS) and screen its SME projects against the IFC Exclusion List and the applicable E&S national laws and regulations. In addition, GLR will continue to comply with life & fire safety requirements and the requirements of IFC's Performance Standard 2 on labor and working conditions.

The key E&S risks and impacts of this Project are related to the ability of GLR to identify and manage potential E&S risks associated with its leasing to SMEs.

Summary of Client Environmental and Social Management System (ESMS)

As an existing client of IFC, GLR has established and implements its ESMS in line with IFC's requirements. The ESMS is applied to the GLR's SME portfolio and outlines the E&S policy, procedures, tools and responsibilities for E&S risk management of its lending activities. Under the Project, GLR will be required to continue applying its existing ESMS to SMEs asset class. GLR will also be required to maintain proper internal capacity, and provide E&S training to the relevant staff.

Contacts

For Inquiries About the Project, Contact

Motoractive IFN S.A.
Carmen Giosanu
Customer Service and Billing Department Manager
+40 (21) 387 87 00
Carmen.Giosanu@garantibbvaleasing.ro
5 Fabrica de Glucoza Street - Novo Parc 3, Building F - 020331 Bucharest
www.garantibbvaleasing.ro

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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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