IFC in Serbia Per Kjellerhaug, IFC

Regional Manager, Western Balkans

The World Bank Group

IBRD

International Bank

for Reconstruction

and Development

IDA

International

Development

Association

IFC

International Finance

Corporation

MIGA

Multilateral

Investment and

Guarantee Agency

Est. 1945 Est. 1960 Est. 1956 Est. 1998

Role To promote

institutional, legal and

regulatory reform

To promote

institutional, legal and

regulatory reform

To promote private

sector development

To reduce political

investment risk

Clients Governments of member

countries with per

capita income between

$1,025 and $6,055

Governments of poorest

countries with per

capita income of less

than $1,025

Private companies in

member countries

Foreign investors in

member countries

Products • Technical Assistance

• Loans

• Policy Advice

• Technical Assistance

• Interest Free Loans

• Policy Advice

• Equity/Loans

• Risk Management

• Advisory Services

• Political Risk

Insurance

2

IFC’s Three Businesses

IFC Investment

Services

IFC Advisory

Services

IFC Asset

Management

Company

• Loans

• Equity

• Other forms of

financing

• Access to Finance

•Investment Climate

•PPPs

•Sustainable Business

•E&S Guidance

• Wholly-owned

subsidiary of IFC

• Private equity fund

manager

• Invests third-party

capital alongside

IFC

3

A Broad Range of Financial Products • Corporate

• Typically 5-15% shareholding

• Long-term investor, typically 6-8 year holding period

• Not just financial investor, adding to shareholder value

• Usually no seat on board

• Subordinated loans

• Income participating loans

• Convertibles

• Other hybrid instruments

• Senior Debt (corporate finance, project finance)

• Fixed/floating rates, US$, Euro and local currencies available

• Commercial rates, repayment tailored to project/company needs

• Long maturities: 7-12 years, appropriate grace periods

• Range of security packages suited to project/country

• Mobilization of funds from other lenders and investors, through financings,

syndications (IFC “B” Loan structure), underwritings and guarantees

4

Equity

Mezzanine /

Quasi-Equity

Senior Debts &

Equivalents

5

IFC’s Global Reach

100+ country and regional offices worldwide

Dakar

Nairobi

Johannesburg

Cairo

Washington

Mexico City

Bogota

Buenos Aires

São Paulo

Port-of-Spain

Moscow

IFC HQ/Hub Offices

IFC Operational Centers

IFC Country Offices

Hong Kong

New Delhi

Almaty

Istanbul

6

2.5 million jobs

$200 billion in micro, small, and medium enterprise loans

12.2 million patients with health care treatment

34.3 million people with clean water

41.9 million people with power connections

900,000 students with education

Last year our clients provided:

The Reach of IFC’s Projects

7

Fiscal Year 2012 Highlights

• Investments: 576 new projects in 103 countries

• Advisory services: Nearly $200 million in program expenditures

• $20.3 billion in financing: $15.4 billion for IFC’s own account,

$4.9 billion mobilized

• $56.5 billion committed portfolio, representing investments in

1,825 firms

• IDA countries account for almost half of IFC projects overall:

• $2.7 billion invested in Sub-Saharan Africa

8

Investments by Region, FY12

Commitments for IFC’s Account: $15.4 Billion

Sub-Saharan Africa 18%

East Asia and

Pacific 16%

South Asia 8%

Europe and Central Asia

19%

Latin America and

the Caribbean 24%

Middle East and North

Africa 14%

Global

>1%

9

IFC in Serbia

• Serbia became a shareholder and member of IFC in 2001.

• As of 31 January 2013, IFC's portfolio in Serbia stands at $761.6 million.

• Last financial year FY12 (July 2011 – June 2012), IFC invested US$351.2

million and mobilized US$152.8 million in Serbia, supporting projects in

the financial sector, agribusiness, and manufacturing sectors.

• In Serbia, IFC works with private sector clients, government, and civil

society to bring the benefit of global expertise to the country through its

advisory services and investment projects.

• Our priorities in Serbia include: crisis response, agribusiness, climate

change and improvements in investment climate.

•

IFC Advisory Services - Infrastructure

10

2.2 billion

• IFC provides advice on designing and implementing

public-private partnership (PPP) transactions to

national and municipal governments to improve

infrastructure and access to basic services such as

water, power, health and education. The program is

supported by our donor partners: Austria, Norway and

Switzerland.

• The Balkans Renewable Energy Project works to

develop the small hydro power plants (SHPP) market in

the Western Balkans countries. Supported by the

Ministry of Finance of Austria.

* Sept 2011

IFC Advisory Services - Corporate Governance and

Investment Climate Projects

11

2.2 billion

• IFC’s Corporate Governance Program in Serbia is aimed at improving

corporate governance practices in companies and financial institutions, as

well as enhancing the corporate governance framework at the

institutional, regulatory and policy levels.

• The Southeast Europe Tax Transparency and Simplification Program

works to simplify tax administration procedures to reduce tax compliance

costs, particularly for SMEs; and improve the legal framework and

efficiency of administration of international taxation procedures, with a

focus on transfer pricing and double taxation treaties. Supported by the

Swiss State Secretariat for Economic Affairs (SECO).

• The Western Balkans Trade Logistics Project works to Reduce the

number of documents and days needed for goods to be exported and

imported; and streamline procedures for the flow of cargo by road, air,

and river. Supported by the EU.

IFC Investment Services –

Recent Agribusiness Projects

12

2.2 billion

• € 57 million loan to Victoria Group, a leading agricultural group in Serbia.

• €55 million loan to Atlantic Group (Croatia), a leading regional food and

beverage producer and distributor of FMCG. A portion of the funds will be

disbursed directly in Serbia to the Atlantic’s Serbian subsidiaries.

• €12.5 million to Serbia’s beverage maker Vino Zupa to support

development of agribusiness in the country.

• €45 million to MK Group, a Serbian food producer, to modernize and

expand production.

* Sept 2011

IFC Investment Services –

Recent Financial Markets Projects

13

2.2 billion

• €70 million loan to the Serbian unit of Societe Generale SA to finance

agricultural development.

• IFC extended a €50 million loan to UniCredit equally divided between

housing line (focus on low income households) and agribusiness line

supporting one of Serbia’s key sectors.

• Banca Intesa a.d. Beograd: US$12.1 million (EUR 9.1 million)

participation in rights issue.

• Cacanska Banka: US$7.2 million loan aimed at the SME lending in frontier

regions (following $9.1 million equity investment in FY11).

• Komercijalna Banka a.d. Beograd: US$75 million sub-debt for

strengthening capital base (following US$65.2 million preferred share

investment (through AMC) to help capitalize the largest state owned bank

and extend support to the SME sector).

IFC Investment Services –

Recent General Manufacturing Projects

14

2.2 billion

• IFC invested €50 million for a minority stake in Titan Cement Cyprus,

owned by Greek cement manufacturer Titan Cement. The investment will

support Titan’s subsidiaries in the Western Balkans: Cemertara Kosjeric in

Serbia, Cementarnica USJE in the FYR Macedonia, and SharrCem in

Kosovo.

• IFC extended €20 million to PMC Automotive Serbia, a joint venture

between Italian automotive suppliers CLN Group and PROMA Group. The

venture is a Greenfield metal stamping facility in the designated supplier

park, aimed at supporting the automotive supply chain for the production

of the new sub-compact vehicle in the FIAT plant in Kragujevac.

• Kronospan: US$30 million subordinated loan to help the sponsor complete

a US$120 million investment in a new particle board production plant.

Contact

15

Per Kjellerhaug, IFC

Regional Manager, Western Balkans

Bulevar Kralja Aleksandra 86

11000 Belgrade

Tel: +381 11 3023 750

Email: Pkjellerhaug@ifc.org