The financing is made available through an investment under its existing Diversified Payment Rights (DPR) programme, an established market instrument used by Turkish banks to raise long-term funding.
Denizbank is planning to issue a total US$ 435 million, marking its return to DPR securitisation under the Emirates NBD Bank’s ownership. The issuance has attracted a host of investors, including the International Finance Corporation, Credit Suisse and the parent Emirates NBD Bank.
Hakan Ateş, DenizBank Financial Services Group CEO, said: “We believe that this deal will pave the way for new transactions in the Turkish market under DPR securitisation programmes backed by future flows. With its long-term maturity of up to seven years and competitive funding terms, this transaction is also a testament to the improving confidence in the Turkish economy.”
Jürgen Rigterink, EBRD First Vice President, commented: “This is a landmark transaction on several accounts. First, it marks Denizbank’s return to its DPR programme under the Emirates NBD Bank’s ownership. Second, it allows the EBRD to provide new financing for women entrepreneurs and for green investments by smaller businesses such as those in renewable energy, resource efficiency, waste minimisation and water savings. And third, by joining forces with the EU, the Turkish Credit Guarantee Fund and the Ministry of Treasury and Finance, the EBRD and Denizbank will be able to achieve a greater impact of our financing.”
The EBRD funds for Denizbank will be equally split between the Women in Business programme to finance women-led SMEs and the Turkey Sustainable Energy Finance Facility programme in support of resource efficiency and small-scale renewable energy investments. The European Union is supporting both initiatives with grant funding.
In addition, women-led businesses will benefit from risk-sharing through the Turkish Credit Guarantee Fund (KGF) and the Republic of Turkey’s Ministry of Treasury and Finance.
The EBRD’s new investment follows a record €893 million in financing to Turkish financial institutions in 2020 to support thousands of businesses across the country, providing the private sector with much-needed funds.
The EBRD is a major investor in Turkey and to date, the Bank has invested almost €13 billion in the country through 334 projects, 95 per cent of which is in the private sector. In 2020 the Bank responded to the Covid-19 pandemic by stepping up its financing in Turkey to €1.7 billion from €1.0 billion in 35 projects in 2019.
