Romania Romania EBRD Financing for the EBRD Financing for the Municipal Infrastructure Municipal Infrastructure Sector Sector Bucharest Bucharest 26 June 2008 26 June 2008
Jan 17, 2018
Romania Romania EBRD Financing for the Municipal EBRD Financing for the Municipal
Infrastructure SectorInfrastructure Sector
Bucharest Bucharest
26 June 200826 June 2008
EBRD in RomaniaEBRD in Romania
First bank to finance municipal sector – active since 1995 in financing water and wastewater sector
Other sectors –active in financing projects in solid waste, urban transport and district heating
Focus on local utilities - to date, nearly €500 million in financing for 31 investment programs mobilising financing of over €1.3 billion in Romania
Expand support to municipal and regionalization projects in conjunction with dedicated EU programmes
EBRD has provided co-financing of nearly €220 EBRD has provided co-financing of nearly €220 million for EU funds of €470 millionmillion for EU funds of €470 million
Oradea
Arad
Timisoara
Craiova
Tirgoviste
Cluj
Bistrita
Botosani
Bacau
Iasi
Focsani
Tg Mures
BrailaBrasov
Constanta
Sibiu
= Phare
= ISPA
= Other Sector
Bucharest
PitestiPloesti
EBRD Finance evolves with the marketEBRD Finance evolves with the market
A. 1995 -1997: Sovereign structures – On-lending for 16 water operators. Introduced FOPIP (Financial, Operational Performance Improvement Program) which was key in improving commercialisation and long term sustainability of water utilities.
B. 2000-2006 Non-sovereign loans to water operators with local authority guarantees for ISPA co-finance. Strong emphasis on implementation. In addition, municipal loans for street rehabilitation, regional roads
C. Public Private Partnerships D. Today – Lending to utility operators without
any kind of guarantee, in water/wastewater sector, district heating, solid waste.
A. Sovereign StructuresA. Sovereign Structures
Three loans: Municipal Utilities Development Programs (MUDP) 1 and 2, including 15 large and medium sized municipalities and Regional water Program for Jiu Valley.
MUDP 2 and Regional Water Program co-financed EU Phare
Created the basis for institutional development at utility level which enabled timely preparation for EU ISPA program
B. Non-sovereign financingB. Non-sovereign financing
Started in 2000, following the new law for municipal finance allowing local authorities and municipal guaranteed loans for public utilities.
The Bank initiated a framework financing structure to co-finance EU-ISPA grants for water sector
The loans were granted to publicly owned utilities based on the financial guarantee of the local authority
The non-sovereign municipal financing was expanded to other sectors besides water such as district heating, solid waste, street rehabilitation
C. PPP Structures for Water SectorC. PPP Structures for Water Sector
The Bank financed the only PPP for water sector in Romania in Bucharest
Financing granted to APA NOVA Bucharest to finance the Crivina Water Treatment Plant.
Very successful implementation. Completion of 80 M EURO Investment Program in 2 years
D. Non-recourse Financing D. Non-recourse Financing StructuresStructures
Started in 2005 with loans to public transport Companies, without municipal guarantees, based on Public Service Contracts
In 2006/2007, expanded for the water sector, granting loans to public water utilities, without local guarantees, based on the Concession Contract between the local authorities and water utilities.
Strategy of the Bank to support the regionalization of the water/wastewater and solid waste services, with benefits for the small and medium sized municipalities
Lending to utility operatorsLending to utility operators
Structural reforms have resulted in improvement in the municipal infrastructure sector
Companies that have been willing to implement reforms have the ability to borrow based on their own cash flow without any guarantee.
Most recent loans to Aquatim Timisoara and SC Apa Canal Oradea. Structure supports regionalisation of the water and waste water services in the County of Timisoara and Bihor.
The Bank is also financing UT operators and DH companies based on Service Contracts
How EBRD supports municipal How EBRD supports municipal infrastructure sector infrastructure sector
1. Water and wastewater sector EBRD supports regionalisation and is working actively to support its
clients in these ventures Compania Somes – only regional operator organised along a water basin for Cluj and Salaj Counties
EBRD remains active in project implementation, with dedicated staff based in Romania to support projects in the municipal sector.
2. Urban Transport- loans to operators to finance rolling stock, to local authorities to finance regional roads or street rehabilitation( Brasov, Sibiu, Iasi)
3. District Heating- loans to DH companies( Timisoara, Iasi) EBRD maintains a dialogue with the government EBRD, alongside EU and EIB, is active in JASPERS
What EBRD can financeWhat EBRD can finance
EBRD lends directly to the utility company, provided cash flows are sufficient to support debt
Client assumes responsibility for implementation, resulting in efficient project implementation and less delays in project completion
EBRD will review service agreements to ensure they are structured to balance the needs of the operator and its client base
Attributes of EBRD FinanceAttributes of EBRD Finance
Strong understanding of market and clients due to long history of working in the sector
Long term flexible structures with suitable grace periods
Pricing is competitive and in line with the market Active in all phases of project, ranging from project
preparation to project implementation Direct access to EBRD bankers who provide on-going
client support
Contact DetailsContact Details
Dana Craciunescu – [email protected]
Senior Banker, EBRD Bucharest
www.ebrd.com