Founded in 1991, Banca Tiriac was the first privately owned Romanian bank, it provides a full range of banking services to corporate and retail clients in Romania. As at end-2003, Banca Tiriac was the tenth largest bank in Romania by net assets, representing 3.2% of the system. It currently has 58 branches (30 branches, 25 agencies and 3 working points), 200 ATMs and 1,550 POSs (point of sale card readers). Banca Tiriac is majority owned by Mr. Ion Tiriac, a well reputed businessman and a former Romanian Davis Cup tennis champion. Mr. Tiriac owns about 73.6% of the Bank directly and indirectly. From sports management, Mr. Tiriac has diversified into business interests in the financial sector (including insurance, in a joint venture with Allianz Insurance, the second largest insurance company in Romania and one of the most successful in the sector), tourism, transportation and real estate. EBRD owns 5.4%. of shares in the Bank with the remaining 21% held by around 5,537 legal entities and individuals and private investors.

The proposed investment consists of up to US$20.0 (or Euro equivalent) in form of a senior loan. IFC is also considering the possibility of providing a subordinated convertible loan for up to $7.5 million (or Euro equivalent).

27.50 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	27.50
Equity

* These investment figures are indicative

The location of this project is in Bucharest, Romania.

Development Impact By strengthening a private Romanian bank, IFC will boost the development of the local banking sector through balance sheet strengthening and institution-building. The project would facilitate access to term lending by the growing base of local entrepreneurs through a Romanian bank that is strongly oriented to corporate, SME and retail lending. Environmental standards, quality assurance and efficiency should all improve as these companies seek to become competitive prior to EU accession. During the environmental review of eligible borrowers in the real sector that will be carried out by BT, the companies will be introduced to the IFC environmental compliance standards. The Bank’s staff will also benefit from IFC environmental training and implement specific environmental management plans. IFC Role In the financial sector, IFC’s focus has been to build and strengthen financial intermediaries in Eastern Europe. The banking sector in Romania is still developing and IFC believes that there is a significant opportunity to accelerate its growth in this country. By granting this loan IFC will help expand a reputable bank in Romania and strengthen the banking sector. It will also increase the positive impact on increased access to finance for the local corporate and SME sector. Finally, IFC will play a potentially strategic role in strengthening and adding value to the bank before a possible sale to a strategic investor.

This is an FI type 1 project according to IFC’s environment and social review procedure. Banca Tiriac must implement an environmental and social management system to ensure that relevant lending complies with host country environmental and social requirements.
Location of environmental documents in locally affected community