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MIGA’s goal is to promote foreign direct investment into developing countries to support economic growth and more.

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Explore different types of political risk insurance guarantees provided to investors and lenders.

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Explore global projects that support economic growth, reduce poverty and improves people’s lives.

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Learn about the progress MIGA is making in its mission to support economic growth, reduce poverty and improve people’s lives.

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World Bank building

MIGA’s goal is to promote foreign direct investment into developing countries to support economic growth and more.

Our Impact Dropdown Description

Hands husking peas into a basket full of peas

Learn about the progress MIGA is making in its mission to support economic growth, reduce poverty and improve people’s lives.

Our Products Dropdown Description

Young woman bending down to tending to her outside chores

Explore different types of political risk insurance guarantees provided to investors and lenders.

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Hyundai building

Explore global projects that support economic growth, reduce poverty and improves people’s lives.

Kosovo

RBI Central Bank Mandatory Reserves Coverage

$95 million
Banking
Project Brief
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Project Description

On March 31, 2024, MIGA issued a guarantee of up to EUR95.0 million covering equity investments by Raiffeisen Bank International AG (RBI) in its subsidiary in Kosovo, Raiffeisen Bank Kosovo J.S.C. (RBI Kosovo) for a period of up to three years.

Vienna-based RBI is a universal banking group that has operated for over 30 years in Central, Eastern and Southeastern Europe (CEE), with subsidiary banks in 13 CEE markets. RBI’s subsidiary banks are required to maintain reserves at the central banks in their respective jurisdictions, generally based on the volume of customer deposits that these subsidiaries have. This exposure leads to higher risk weights on assets at the consolidated level, resulting in increased capital allocation for country risk exposure. At the consolidated level, the risk weighting determines the amount of equity required to maintain a specified capital adequacy ratio in accordance with European banking regulations.
 

Environmental Categorization

RBI Kosovo has been a MIGA client since 2015. The Project is categorized as FI-2 under MIGA’s Policy on Environmental and Social Sustainability (2013).  RBI Kosovo, part of the RBI universal banking group, is a commercial bank providing loans to corporates, SMEs and retail clients in Kosovo.

As an existing client, the bank has an environmental and social (E&S) officer and  implements an Environmental Management System (EMS) which is in line with the requirements of MIGA Performance Standard 1 regarding Environmental and Social Management Systems (ESMS). The EMS applies to all lending and includes all applicable E&S requirements defined as the MIGA Exclusion List, compliance with national laws and regulations, and application of the Performance Standards. Transactions are screened against the applicable E&S requirements and E&S action plans are developed to address identified gaps where required. RBI Kosovo has developed a set of human resources policies and procedures, that are in line with requirements of the national legislation and all the applicable requirements of MIGA Performance Standards 2: Labor and Working Conditions.

RBI Kosovo will continue to report periodically to MIGA on the implementation of the EMS and application of the Performance Standards.

Development Impact

MIGA’s guarantee will support RBI’s overall business strategy in Kosovo. MIGA’s guarantee allows RBI to achieve RWA relief at the group consolidated level and provide the enabling conditions to the parent bank to pass the benefits of this support to its operating subsidiaries. As mandatory reserves, held at each respective central bank, attract lower risk weights because of MIGA, assets in Kosovo can be deployed more productively, thereby either accelerating the pace of leveraging (i.e. expansion of loans to customers) or slowing down the pace of deleveraging (i.e. retention of loans to customers).

MIGA’s guarantee helps RBI reduce the risk of some of its assets, which lead to a reduction in the group’s RWA on a consolidated basis. The RWA capacity that is freed up is expected to be used by RBI to support operations in Kosovo, and support new lending in climate finance activities and small and medium enterprises in the country.

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