23630 - PBZ Privredna Banka Zagreb

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Summary of Proposed Investment

Project Number

23630

Company Name

Privredna banka Zagreb d.d.

Date SPI Disclosed

Oct 8, 2004

Country

Croatia

Industry

Financial Markets

Projected Board Date

Nov 8, 2004

Status

Completed

Sector

Commercial Banking - General

Department

Regional Industry FIG LAC & EUR

Environmental Category

Previous Events

Approved : Dec 16, 2004
Signed : Dec 21, 2004
Invested : Dec 29, 2004

Project Description

Privredna banka Zagreb (PBZ) is Croatia’s second largest commercial bank. PBZ used to be a state-owned bank and was privatized in 2000 when Gruppo Intesa of Italy acquired a controlling stake of 66.3%. Subsequently, in the second round of privatization in 2002, Gruppo Intesa increased its stake to 76.3% and the European Bank for Reconstruction and Development (EBRD) acquired an equity stake of 20.79%. PBZ is a full-fledged commercial bank and offers the full range of banking products to corporate and retail customers in Croatia. The proposed project aims to provide a long term loan facility to PBZ to enable it to enhance long term lending to its customers, particularly to retail mortgage customers and small enterprises.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	102.05
Equity

Development Impact

This project will have the following developmental impacts: - It will enhance the availability of long term credit to small enterprises in Croatia. Although they comprise a large segment of Croatia’s economy and employ a large proportion of its labor force, small enterprises still lack access to credit from the banking system in adequate amounts and maturities. - It will enhance the availability of long term mortgages to the residential market, a segment which could be a key driver for economic growth. - It will further strengthen the balance sheet of a strong and credible Croatian bank. IFC’s role in this project is to - provide long term credit that is otherwise not adequately available domestically, and - strengthen its relationship with PBZ/Gruppo Intesa as part of a broader developmental role that IFC seeks to play in the region.

This is a category FI, type 1 project according to IFC''s environmental and social project review procedure. As a result of an earlier EBRD investment, PBZ has developed and is implementing an acceptable Environmental Management System (EMS). The EMS requires PBZ and their clients to comply with Croatian environmental, health and safety requirements. PBZ has also committed to send two of their environment staff to IFC''s new 5 day Competitive Business Advantage (CBA) Workshop to upgrade their skills. Finally PBZ will provide Annual Monitoring Reports (AMR) to IFC (in the same format as used to report to EBRD) to ensure their is ongoing compliance to the approved EMS.
Location of environmental documents in locally affected community

Contacts

For Inquiries About the Project, Contact

rraman@ifc.org Investment Officer International Finance Corporation

This Summary of Project Information (SPI) is prepared and distributed to the public in advance of the IFC Board of Directors' consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC's activities, and this document should not be construed as presuming the outcome of the Board decision. Board dates are estimates only. The following SPI is disclosed in accordance with IFC's Disclosure of Information Policy that went into effect September 1998.

The map is for illustrative purposes and does not imply the expression of any opinion on the part of the World Bank, concerning the legal status of any country or territory or concerning the delimitation of frontiers or boundaries. Country borders or names do not necessarily reflect the World Bank Group's official position. In some cases, available project location information is limited to the country of the project's activities. Locations are approximate.

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