European Bank for Reconstruction and Development (EBRD)

Organizational profile:

The European Bank for Reconstruction and Development (EBRD) was established to help build a new, post-Cold War era in Central and Eastern Europe. The EBRD is committed to furthering progress towards ‘market-oriented economies and the promotion of private and entrepreneurial initiative’. Uniquely for a development bank, the EBRD has a political mandate in that it assists only those countries ‘committed to and applying the principles of multi-party democracy and pluralism’. Project investments are at the heart of their operations. Safeguarding the environment and a commitment to sustainable energy have also always been central to the EBRD’s activity. A commitment to promote ‘environmentally sound and sustainable development’ was made explicit at its founding.

The Green Economy Transition (GET) 2021-25 is the Bank’s approach for helping economies where the EBRD works build green, low carbon and resilient economies. The EBRD works with the private sector, municipalities and public institutions to address climate change through their unique business model combining green investments, concessional financing, policy engagement and technical support. The green project portfolio includes sustainable forest management, reforestation, watershed management, and the prevention of deforestation and soil erosion.

The EBRD serves the interests of all its shareholders - 71 countries from five continents plus the European Union and the European Investment Bank - not just those countries which receive its investments (a record €13.1 billion in 2022). 

Financing Instrument: Loans, Equity, Guarantees, Technical Assistance

Project scale:

EBRD financing for private sector projects generally ranges from US$5 million to US$250 million, in the form of loans or equity. The average EBRD investment is US$25 million.  Smaller projects may be financed through financial intermediaries or through special programmes for smaller direct investments in the less advanced countries.

Loan usually range between €3 up to €250 million, although this can be smaller in some cases. EBRD loans are based on current market rates and are priced competitively. Following a successful enquiry and once a project has been presented to the Bank, financial terms can be discussed in detail with banking staff. The EBRD does not subsidise projects, nor does it offer soft loans.

EBRD invests in equity ranging from €10 million to €200 million in private sector projects.

For private sector projects, the EBRD is normally prepared to provide, in the form of debt or equity, up to 35% of the long-term capital of a single project or company. Pricing of debt will primarily reflect the commercial risk and will be set to conform to prevailing conditions in the syndicated loan market.

Through its Trade Facilitation Programme the EBRD provides guarantees to international confirming banks, taking the political and commercial payment risk of international trade transactions undertaken by banks in its regions.

Applicable geographical regions/ country groups: The EBRD is currently active in 38 countries from central Europe to central Asia and the southern and eastern Mediterranean, plus the West Bank and Gaza.

Recipient categories: Businesses, Financial institutions

Eligibility Criteria:

Projects may be considered for EBRD assistance if they:

• are located in an economy where the EBRD works
• have good prospects of being profitable
• have significant equity contributions in cash or in kind from the project sponsor
• would benefit the local economy
• satisfy the EBRD's environmental standards as well as those of the host country

Application guidelines:

If you are interested in obtaining EBRD finance, the EBRD financing enquiry form should be completed and submitted. Forms will only be accepted from commercial companies or by an intermediary authorised to act for them. You will receive a response from an EBRD representative within 7 working days of submitting the form.

The EBRD project cycle consists of the following stages:

• Concept review- Typically, EBRD management approve the project concept and overall structure, including the proposed financing structure and supporting obligations. At this stage, the EBRD and the client usually sign a mandate letter, which outlines the project plan, development expenses and responsibilities.
• Final review- Once the basic business deal (including a signed term sheet) has been negotiated and due diligence has been substantially completed, the project is submitted for Final Review by EBRD management.
• Board Approval- The EBRD President and operations team present the project to the Board of Directors for approval unless Board approval has been delegated to management. 
• Signed- The EBRD and the client sign the deal and it becomes legally binding.
• Disbursing- Once repayment conditions are agreed and the Bank’s conditions met, the funds are transferred from the Bank’s account to the client’s account.

Last updated: 6 September 2023