The EBRD is providing Isbank, Turkey’s largest private bank, with $55m in financing to support small-scale renewable energy and resource efficiency projects in the country.
The funds are extended under the EBRD’s renewed Turkey Sustainable Energy Financing Facility (TurSEFF), a dedicated framework originally aimed at financing small and medium-sized enterprises (SMEs) seeking to enhance their energy efficiency and invest in renewable energy.
In the previous stages of the TurSEFF framework, €600 million has been provided by the EBRD, the European Investment Bank and the Japan Bank for International Cooperation to Turkish partner banks for industrial energy efficiency projects, financing for vendors and producers of qualifying (green) equipment and small-scale renewable investments such as solar PV, biomass and biogas.
The current financing to Isbank comes under the third phase of the framework which includes €400 million in financing from the EBRD and a €5.5 million grant from the EU. In addition to banks, it will also provide funds to leasing companies and for municipal projects.
The EBRD financing is extended through an investment in “A-” rated senior notes issued under Isbank’s Diversified Payment Rights (DPR) securitisation programme, an established market instrument used by Turkish banks to raise long-term funding.
Arvid Tuerkner, EBRD Managing Director for Turkey, said: “Almost half of our projects in Turkey promote the use of sustainable energy and it will remain a priority. Isbank is a long-standing partner of the EBRD and has been instrumental in expanding access to finance for those willing to invest in renewable energy and improve resource efficiency.”
Noel Edison, EBRD Director for Financial Institutions, Insurance and Financial Services and Turkey, added: “We congratulate Isbank on yet another successful use of debt capital markets. We are proud to be one of the seven investors helping Turkey’s largest private lender raise more than US$ 400 million in long-term funding through its DPR programme.”
Yilmaz Ertürk, Deputy Chief Executive at Isbank said: “Having completed our fourth transaction under TurSEFF, we are very pleased to further strengthen our longstanding cooperation with the EBRD and help facilitate the EBRD’s key role in addressing small-scale renewable energy and resource efficiency projects in Turkey. We’re also delighted to continue supporting Turkish borrowers in their endeavours to contribute to a more sustainable economy.”
The EBRD is a major investor in Turkey. To date, the Bank has invested over €9.5 billion in various sectors of Turkey’s economy, with almost all investments in the private sector. In 2017, the Bank signed more than 30 projects worth more than €1 billion and expects to exceed €1.5 billion in investments this year.