Banca Transilvania takes 40 million USD from IFC Capitalization Fund
The IFC Capitalization Fund, a fund managed by IFC Asset Management Company and member of the World Bank Group is investing 40 million USD in Banca Transilvania (BT), the third largest bank by assets in Romania, according to the fund press release.
The 40 million USD subordinated loan will strengthen BT capital base and support the growth of a systemically important bank in the region focused on small and medium enterprises (SMEs).
"This is the third investment in the region for the IFC Capitalization Fund, and the ninth project overall for IFC with Banca Transilvania. We are happy to continue this long-standing partnership between IFC and BT as the bank continues to grow and improve access to finance in the region," said Marcos Brujis, Head of the IFC Capitalization Fund, a 3 billion USD fund which was made possible by commitments from IFC and Japan Bank for International Cooperation (JBIC).
IFC relationship with BT dates back to 2004, when IFC extended a senior loan to BT for mortgage on-lending. Since then, IFC has invested in a series of senior, subordinated, and convertible debt instruments for the bank. This current investment is expected to further strengthen the relationship by helping to finance the bank continued growth plans.
"This new facility will allow us to continue our ambitious plans for organic growth and to capture further market share, mainly in the segment where we are already a trend-setter," said Omer Tetik, BT Chief Executive Officer. "Banca Transilvania has incurred great benefits from its long-term relationship with IFC, not only in terms of obtaining financing facilities from a shareholder but also by having access to the vast SME banking and emerging markets know-how of the institution."
Romania became an IFC member in 1990, and IFC has invested a total of 2.2 billion USD in the country since then. IFC financial markets strategy in Central and Southern Europe is to partner with systemic banks in order to sustain economic growth and job creation. IFC has invested across a variety of sectors and works to provide access to finance for smaller businesses in region.