NLB Tutunska Banka Second Syndicated Loan

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Senior syndicated loan to NLB Tutunska Banka, Skopje, FYR Macedonia, of up to EUR 40 million (the “Loan”) for on-lending to private sector businesses (up to 75% of the Loan) and private individuals (up to 25% of the Loan). The Loan will be granted under the EBRD A/B structure. The EBRD plans to lend EUR 15 million for its own account (“A Loan”) and to syndicate EUR 25 million (“B Loan”) to participating banks. The main rationale for the Bank’s involvement in the project is to support the development and expansion of financial intermediation of the banking sector in FYR Macedonia by providing the necessary medium-term financing to the most dynamic and fastest growing bank in the country and fostering competition. The FYR Macedonian ratio of domestic credit to GDP in June 2005 stood at only 24.2%, which is still much lower than the values for Croatia (73.1%) and the EU (above 100%). The proposed project will also increase NLB Tutunska Banka’s access to medium-term financing and assist the borrower in diversifying its sources of funding through the international syndication market. This will have a strong demonstration effect in encouraging similar funding strategies among other banks in FYR Macedonia as well as by mobilising international lenders to consider opportunities in the countries. NLB Tutunska Banka ad, Skopje is the third largest universal commercial bank in the country. The bank is majority owned by the NLB Group. The EBRD plans to lend EUR 15 million for its own account (“A Loan”) and to syndicate EUR 25 million (“B Loan”) to participating financial institutions. EUR 40 million. NLB Tutunska Banka will continue to: Apply EBRD’s Environmental Procedures for Local Banks; Ensure that the borrowers comply with EBRD’s Environmental Exclusion and Referral List; Comply with relevant national employment laws and standards and Conventions of the International Labour Organisation related to the employment of children and young people, discrimination at work, and forced labour; Ensure compliance of sub-borrowers with national standards for environment, health and safety; Ensure compliance of sub-borrowers with relevant requirements for public disclosure and consultation; and Provide annual environmental, health, safety reports to the Bank. None. Nastoska Ljiljana, Director Corporate Banking Division NLB Tutunska Banka Tel: +389-2-3105-656 E-mail: nastoska@tb.com.mk Biljana Stepanuleska Pochevska, Head Project Finance Department NLB Tutunska Banka Tel: +389-2-3105-678 E-mail: b.stepanuleska@tb.com.mk