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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 UniCredit Bank Serbia JSC
Guarantee Holder UniCredit Bank Austria AG
Investor Country Austria
Host Country Serbia
Sector Banking
Gross Exposure ($million) 123.50
Fiscal Year 2009
Status Proposed
Project Number 8060
Environmental Category FI
Date SPG Disclosed June 05, 2009
Project Board Date June 23, 2009

Project Description

This summary covers a guarantee for UniCredit Bank Austria AG’s (UBA) €100 million shareholder loan to its subsidiary, UniCredit Bank Serbia JSC (UBSR). UBA has applied for a MIGA guarantee of up to $123.5 million for a period of up to five years against the risks of transfer restriction, expropriation, and war and civil disturbance.

The loan will provide UBSR with long-term liquidity and improve UBSR’s asset-liability management by matching assets and funding of similar maturities. The loan is part of a broader funding strategy of the UniCredit Group to finance its subsidiaries and is particularly important in view of the current turmoil in financial markets worldwide, including Serbia.

Environmental Categorization

The project is a Category FI under MIGA’s environmental review procedures.

Development Impact

MIGA supports this project in conjunction with the Financial Sector Initiative framework recently presented to the Board as part of a coordinated international response to the ongoing global financial crisis. Serbia, like many other countries in the ECA region, is currently facing difficult fiscal adjustments along with the need for external financing.  MIGA’s support to the project will supplement the IMF-negotiated program for Serbia by i) injecting liquidity into the UBSR, ii) boosting confidence in Serbia’s financial sector and iii) contributing to the improvement of the country’s financial stability.

One of the main objectives of the World Bank Group’s country partnership strategy for Serbia for 2008-2011 is to encourage dynamic private sector led growth. The proposed project is fully consistent with this objective.

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