Ceska Sproritelna is primarily owned by the Austria-based Erste Group (98%) and enjoys strong parental support allowing the Bank to strengthen its financial profile and retain its solid domestic retail banking franchise. Erste Group focuses on retail and SME banking in Austria and its extended home market in Central and Eastern Europe, with a strong presence in the Czech Republic, Romania and Slovakia. Erste Group operates approximately 3,185 branches and employs approximately 51,000 people worldwide.

The proposed project is to provide a Risk Sharing Facility of up to EUR47.5 million (in local currency equivalent) to Ceska Sporitelna to support their portfolio of renewable energy loans to local businesses. The term of the IFC Risk Sharing Facility is up to 10 years.

59.0 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee	59.0
Loan
Equity

* These investment figures are indicative

Ceska Sporitelna is headquartered in Prague, Czech Republic and has a network of 660 branches throughout the country serving more than 5 million customers.

The following development benefits are expected: (i) Mobilize up to EUR47.5 million via the risk sharing facility; (ii) Increase access to finance for renewable energy projects, which will lead to a sizeable and measurable reduction in GHG emissions; (iii) Reduce the country’s dependence on imports of fossil fuels and natural gas. (iv) Support development of local SMEs, increase the number of renewable energy clients and contribute to employment generation. (v) Directly support the government’s strategy of promoting renewable energy. (vi) Create a replicable facility to be used in lower income European countries.

Without IFC, the Bank’s expansion strategy into the renewable energy sector would be significantly constrained on account of risk appetite and sector exposure limits. IFC will provide risk sharing for amounts and tenors that are not readily available in the market.

As an existing IFC client, Ceska Sporitelna is required to implement a Social and Environmental Management System (SEMS) to manage social and environmental risks related to its financing activities as part of the Commercializing Energy Efficiency Finance (CEEF) program. Applicable environmental and social performance requirements of this existing project include the Exclusion List and national laws. IFC''s appraisal of the new project will focus on the client''s capacity to manage environmental and social risks, including due diligence procedures, as well as its human resources policies and practices to determine compliance with IFC’s Performance Standard 2: Labor and Working Conditions requirements. As a condition of IFC''s commitment, the client will be required to implement an SEMS, which will include environmental and social eligibility criteria for projects proposed for financing, to ensure compliance with the IFC Exclusion List, applicable host countries laws, and IFC Performance Standards if necessary. The client will also be required to appoint staff responsible for SEMS implementation and submit periodic environmental and social performance reports to IFC.