MICROCAPITAL BRIEF: EBRD Loans $29m to Turkish Leasing Firm QNB Finans Finansal Kiralama for Energy-efficiency Investments

The European Bank for Reconstruction and Development (EBRD), a UK-based multilateral institution, recently loaned EUR 25 million (USD 29 million) to Qatar National Bank Finans Finansal Kiralama (QNB Finans Leasing), a subsidiary of the Turkish commercial bank, QNB Finansbank. QNB Finans Leasing plans to use the proceeds to fund leases for small and medium-sized enterprises (SMEs) to reduce their usage of fossil fuels. For example, this could include the installation of small-scale renewable energy power generators, updated waste management systems, and more efficient electrical and water systems. EBRD First Vice President Jürgen Rigterink, said, “Our financing provided to QNB Finans Leasing will encourage Turkish companies to install resource-efficient equipment and generate significant benefits in terms of cost savings, avoided energy and capacity costs, as well as reduced emissions.”

The EBRD loan is part of the third phase of the Turkey Sustainable Energy Financing Facility (TurSEFF), an initiative launched in 2010 by EBRD and the EU to promote activities related to the following: (1) reducing companies’ usage of energy, water and raw materials; (2) decreasing the amount non-recyclable waste they produce; and (3) increasing their production of energy from renewable sources. As of 2018, TurSEFF reportedly results in annual savings of 5,187 gigawatt-hours of electricity and the avoidance of 2.1 million metric tons of carbon dioxide emissions per year. The third phase of TurSeff, which began in 2017, has a budget of EUR 400 million (USD 469 million).

Since 2016, QNB Finansbank has been a member of the QNB Group, a commercial banking entity that was established in 1964 and is owned half by the Qatari government and half by members of the public. Its 15 subsidiaries offer asset management, commercial banking and retail banking in 31 countries in Africa, East Asia and the Middle East. As of December 2017, the group reported total assets of QAR 811 billion (USD 222 billion), outstanding loans of QAR 584 billion (USD 159 billion) and customer deposits of QAR 586 billion (USD 160 billion). QNB Group serves 22 million customers at approximately 1,200 branches as of 2017.

EBRD was founded in 1991 and has 66 shareholding countries – plus the EU and the European Investment Bank – as of 2018. With a focus on “the promotion of private and entrepreneurial initiative,” it invested EUR 9.7 billion (USD 11.2 billion) during 2017 in companies in 36 countries in Eastern Europe, Central Asia, North Africa and the Middle East.

By Nicholas Galimberti, Research Associate

Sources and Additional Resources

EBRD press release
https://www.ebrd.com/news/2018/turkeys-qnb-finans-leasing-receives-ebrd-loan-of-25-million.html

EBRD activity in Turkey
https://www.ebrd.com/where-we-are/turkey/data.html

TurSEFF background
http://www.turseff.org/page/facility

QNB Finansbank financials
https://www.qnbfinansbank.com/en/investor-relations/media/2055/report.aspx

MicroCapital Brief; July 30, 2018; EU Funding Expansion of EBRD Women in Business Programme to Morocco
https://www.microcapital.org/microcapital-brief-eu-funding-expansion-of-ebrd-women-in-business-programme-to-morocco/

MicroCapital Brief; July 12, 2018; EBRD Loans $59m to Qatar National Bank (QNB) Tunisia for Small, Medium-sized Enterprise (SME) Financing
https://www.microcapital.org/microcapital-brief-ebrd-loans-59m-to-qatar-national-bank-qnb-tunisia-for-small-medium-sized-enterprise-sme-financing/

MicroCapital Brief; August 21, 2017; Turkey’s QNB Finansbank Borrows $55m via EBRD’s “Women in Business” Programme, Partially Guaranteed by EBRD, EU, Turkish Government
https://www.microcapital.org/microcapital-brief-turkeys-qnb-finansbank-borrows-55-m-via-ebrds-women-business-programme-partially-guaranteed-ebrd-eu-turkish-government/

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