BCR is controlled (i.e. 69.88% shareholding) by the Government via the Authority for Privatization and Management of State Ownership (APAPS); the remaining 30.12% is controlled by five financial investment companies (SIFs). The SIF’s (i.e., SIF Oltenia, SIF Banat Crisana, SIF Moldova, SIF Transilvania, SIF Muntenia) were created as tools for assisting the mass privatization process following the breakdown of the communist regime in the early 1990s.

The European Bank for Reconstruction and Development (EBRD) and IFC will together purchase 25% plus two shares of BCR for a total amount of $222 million. IFC is planning to purchase 12.5% plus one share of the share capital and voting rights of BCR for $111 million.

150.0 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	75.0
Equity	75.0

* These investment figures are indicative

BCR is headquartered in Bucharest and has over 280 branches throughout Romania. The bank also has subsidiaries in the United Kingdom, Germany, France, Moldova, and representative offices in Moscow and New York. Also, BCR has equity investments in banks in Italy and Egypt.

This is a Financial Intermediary (FI) Type 1 project according to IFC''s environmental and social review procedure. BCR will be required to establish environmental policies and procedures and require their corporate and SME borrowers to comply with local and national environmental and occupational health & safety requirements.
Location of environmental documents in locally affected community

Development Impact: The restructuring and privatization of banks continues to be a costly, though essential, exercise through Eastern and Central Europe. Efficient intermediation of savings into productive investments is vital to the future growth of the region. Given the relatively limited alternative vehicles for intermediation, the banking sector has a disproportionately significant role to play. By supporting the privatization of the largest bank in Romania, IFC's developmental impact is expected to be particularly high. Enhancing the credibility of the bank privatization process is particularly important in Romania as it is a key pillar in the Government's overall privatization program. IFC Role- Lending credibility of the privatization process: IFC has successfully supported high profile bank privatizations in several of Europe's transition economies. The project is expected to replicate this success and lend credibility to the BCR transaction within the context of the GoR's privatization program for the financial sector. The delays in BCR's privatization resulting from the global economic slowdown make this a challenging privatization, one where the signaling effect of multilateral support is particularly significant. The project is expected to catalyze increased investor interest and improve terms and conditions for BCR’s privatization. Strengthening BCR's institutional capacity and enhancing its operational profile: IFC's involvement with BCR prior to the sale to a privatization investor will enable IFC to play a role in strengthening the Bank's operations by requiring the implementation of an Institution Building Plan (IBP) jointly developed by EBRD and IFC. The objective of the IBP is to strengthen BCR’s corporate governance and operations (including upgrades to its systems and risk management), thereby preparing it for full privatization by the end of 2006.