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Project Information

Summaries of proposed guarantees are provided prior to Board consideration and final contract signing, and therefore are subject to change. Project briefs are disclosed after contract signing and do not reflect subsequent modifications (e.g., changes in guarantee amount).
Project Name I.C.S. Raiffeisen Leasing S.R.L. 
Guarantee Holder Raiffeisen Bank SA
Investor Country Romania
Host Country Moldova
Sector Financial Services
Gross Exposure ($million) 7.22
Fiscal Year 2008
Status Proposed
Project Number 7552
Environmental Category C
Date SPG disclosed April 9, 2008
Projected Board date April 25, 2008

Project Description

This summary covers a shareholder loan of $7.6 million from Raiffeisen Bank SA in Romania to its subsidiary I.C.S. Raiffeisen Leasing S.R.L. (RLM) in the Republic of Moldova through its subsidiary Raiffeisen Leasing IFN SA. The purpose of this loan is to provide RLM with the necessary funds to start its leasing operations. MIGA has been asked to provide coverage for 95 percent of the shareholder loan. The requested coverage is for up to six years against the risks of transfer restriction and expropriation of funds.

This project constitutes the start-up phase of Raiffeisen Zentralbank (RZB) Group’s leasing operations in Moldova, undertaken by its Romanian subsidiary, RLM. In Moldova, RLM is focusing on leasing solutions for businesses. Vehicles, such as trucks, trailers, and industrial equipment, are expected to make up 60 percent of the portfolio, with passenger cars (including vans and buses up to 3.5 tons) making up the balance. Fifty percent or more of the total number of borrowers supported by this investment are expected to be small and medium-size enterprises (SMEs)—defined by Moldovan regulations as companies with fewer than 50 employees and turnover of less than €1.5 million.

Environmental categorization

The project is a Category C under MIGA’s environmental review procedures. None of MIGA’s issue-specific environmental and social safeguards are applicable to this project.

Development impact

This project is expected to contribute to the development of the financial sector in Moldova by improving access to finance, particularly to segments of the economy that are currently underserved. The leasing sector in Moldova is in its early stages with a small number of participants, some of which dominate the sector. The shareholder loan will allow RLM to start its leasing operations and contribute towards meeting the rapidly growing demand for leasing services in Moldova.

The financial sector of Moldova will also benefit from the presence of an experienced foreign banking institution like RZB Group, in terms of strengthening standards by establishing best practices, developing new products, and fostering competition among financial institutions.

The World Bank Group’s country assistance strategy for Moldova places emphasis on the need to help develop and expand the private sector, particularly SMEs, and to broaden financial sector intermediation in the country.

This is MIGA’s first proposed guarantee in support of foreign investment in the Moldovan leasing sector. This is also MIGA’s first proposed guarantee for a Romanian investor and the first guarantee in support of RZB Group’s operations in Moldova.


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