Makhtar Diop, managing director of the International Finance Corporation (IFC), the investment division of the World Bank, announced this week two major deals designed to catalyse the country’s green transition, boosting financial inclusion, and driving sustainable economic growth in Romania.

IFC is partnering with leading Romanian bank BRD Groupe Societe Generale for a landmark synthetic significant risk transfer (SRT) transaction in which IFC will provide a risk guarantee on an up to EUR 700 million BRD portfolio of small and medium enterprise and corporate loans. Capital freed up by the SRT will enable the bank to lend up to EUR 315 million to fund climate-related initiatives and women-owned smaller businesses.

IFC is also providing a green loan of approximately EUR 300 million to Warehouses De Pauw NV (WDP), a Belgian real estate investment trust, to expand its portfolio of green, energy-efficient semi-industrial and logistics assets across Romania. The financing includes sustainability-linked features, incentivising the WDP to further enhance its climate agenda by increasing the percentage of EDGE (Excellence in Design for Greater Efficiencies) certified properties and growing the roof-top installed solar panel capacity in Romania.

The loan comprises EUR 150 million from IFC’s own account with the remainder mobilised from investors including Sumitomo Mitsui Banking Corporation. IFC also supported WDP in designing its first sustainability-linked loan under a new energy savings and emissions reduction framework.

„The projects announced today underscore IFC’s commitment to supporting Romania in unlocking the private sector’s potential to foster sustainable inclusive growth. By leveraging innovative financing tools and partnering with the government and the private sector, we aim to enhance the country’s business infrastructure, boost climate initiatives, and provide new opportunities for women-owned smaller businesses,” Makhtar Diop is quoted as saying in a press release issued by IFC

According to IFC, investment needs for Romania’s green transition are two times higher than in other European countries (7% of GDP per year compared to an average of 4%), with just 1.6% of bank loans currently allocated to green projects.

Romania represents IFC’s largest country exposure in Europe, with a portfolio of USD 2.1 billion, and its 10th largest globally with over USD 7 billion invested across sectors since 1991. IFC’s commitments this fiscal year currently amount to a record USD 1.5 billion, including USD 1.1 billion in mobilisation, complemented by targeted advisory support to spur the green transition.

IFC supported a first wave of privatisations and new concessions in telecoms, banking, and manufacturing, when access to international financial markets was scarce. It also structured the first water public-private partnership project in the country, dramatically improving water access in Bucharest. IFC initiated or participated in a series of first innovative financial instruments enabling capital to flow into important sectors, including climate, water, housing, smaller businesses, and social inclusion.

IFC, a member of the World Bank Group, is the largest global development institution focused on the private sector in emerging markets. It works in more than 100 countries, using its capital, expertise, and influence to create markets and opportunities in developing countries.

AGERPRES