Bosnia and Herzegovina is receiving its first syndicated loan, which will introduce international commercial banks to the country’s banking sector, an area they have previously been reluctant to consider for investment.
The EBRD-led syndication, which was oversubscribed, will lend €45mn to Raiffeisen Bank dd Bosna i Hercegovina (RB) Sarajevo, the largest bank in the country, which will enable it to provide private-sector clients – including small and medium-sized businesses – with medium- to long-term financing that is otherwise scarce.
Rogers LeBaron, director of bank lending at the EBRD, says the project is important because it will introduce new lenders to the Bosnian banking sector and will open a new avenue of opportunities for clients looking for longer term loans. By attracting commercial financing, RB will be in a position to expand its current lending opportunities that will benefit its many clients, adds LeBaron.
The EBRD will directly lend €15mn, and the remaining €30mn will be syndicated to nine banks from five countries. Nederlandse Financierings-Maatschappij Voor Ontwikkelingslanden is taking €10mn and Portugal’s Caixa Geral de Depositos, Germany’s Bayerische Hypo- und Vereinsbank and Austria’s Österreichische Volksbanken are each taking €3.5mn as co-arrangers.
Acting as lead managers, State Bank of India is taking €2.5mn, while American Express Bank, RZB-Austria and WGZ-Bank are taking €2mn each.
Austria’s Adria Bank AG is taking €1mn as a manager.
Established in 1992 as Market Banka d.d., the bank was renamed in 2000 when it was acquired by RZB-Austria, which currently holds a 99.97% stake in the bank.