DCR Hungary Credit Rating Agency

completed

Summary Of Project Information (SPI)Project NameCzech Republic and Hungary-DCR Czech Credit Rating Company (DCR Ceska Ratingova, a.s. or “DCRC”) and DCR Hungarian Credit Rating Company (DCR Magyar Hitelminosito Rt. or “DCRH”)      RegionEuropeSectorProject No008355/008784Projected Board DateMarch 23, 1998Company NameDuff & Phelps Czech Credit Rating Company (DCRC) and Duff & Phelps Hungarian Credit Rating Company (DCRH)Technical Partner and/or Major Shareholders The technical partner of both credit rating agencies will be Chicago-based Duff & Phelps Credit Rating Co. (DCR), the third largest credit rating agency in the US. DCRC will be established along with Ekonomia, the largest publisher of business newspapers and magazines in the Czech and Slovak Republics and PlanEcon, a consulting company specializing in economic and industrial analysis in Central-Eastern Europe and in the republics of the former Soviet Union. DCRH will be established along with HVG Kiadoi Rt. (“HVG”), an independently owned publisher of the leading Hungarian economic news magazine, Heti Vilaggazdasag, and PlanEcon.Project Cost Including proposed IFC investment The project cost of each agencies will be US$0.5 million. IFC would acquire a 15% equity interest in DCRC (US$75,000) and a 20% equity interest in DCRH (US$100,000) for a total investment of US$175,000.Location of project and Description of site DCRC: Prague, Czech Republic; DCRH: Budapest, HungaryDescription of Company and Purpose of Project(include IFC’s Role and Development Impact) The project is to establish two credit rating agencies, DCRC in the Czech Republic and DCRH in Hungary. These would be the first such institutions in both countries. It is envisaged that the two companies would be part of a regional network, including IFC’s recent investment in a similar company in Turkey. Capital markets in both Hungary and the Czech Republic have reached a level where the lack of the existence of a credit rating agency may hinder the process of further development. The establishment of credit rating agencies in these countries is expected to provide investors with an objective risk evaluation of debt securities and lead to greater transparency and investor protection. The comfort imparted by the credit rating agencies should contribute to a greater willingness by savers to invest in corporate debt instruments, a relatively lower cost for the more credit-worthy borrowers, and the development of a healthy corporate debt market. Environmental Category and Issues This is an environmental review category C project. No further environmental review is required.Date SPI sent to PIC      February 23, 1998“This Summary of Project Information is prepared and distributed to the public in advance of consideration of the proposed transaction by the Corporation’s Board of Directors. It is provided for the purpose of enhancing the transparency of IFC’s activities and should not be construed as presuming the outcome of IFC Board consideration.”For Additional Information contact: Corporate Relations Unit -telephone: (202) 473-7711facsimile: (202) 974-4384