Project Mirna: equity acquisition

disbursing

Project Description This PSD relates to a historical Bank project approved some years ago, and does not represent a new approval, or allocation of new funds.  Disclosure of this PSD was deferred in accordance with the transparency framework in place at the time, but due to an administrative oversight, was not subsequently disclosed The Bank, in 2013, approved participation in the EUR 55 million public offering by Pozavarovalnica Sava d.d. (Sava Re) for up to EUR 10 million, best to support equity capital raising in difficult market conditions, particularly given concerns regarding the political situation in Slovenia at the time of the proposed transaction. Project Objectives The transaction was to support Sava Re raise equity capital under difficult market conditions and assist in development of markets in the former Yugoslav republics where insurance penetration was low; particularly in light of the on-going concerns about Slovenia’s political situation at the time coupled with the instability of the banking and insurance sector. Transition Impact The transaction aimed at (i) greater competition by supporting consolidation in the market, (ii) more widespread private ownership through privatisation and (iii) demonstration of new products / services through creating new distribution channels for Sava Re. Additionality The EBRD’s additionality stemmed from (i) supporting in raising capital in midst of high political uncertainty, (ii) mitigation of political risk and (iii) improved corporate governance through nomination of EBRD’s non-executive director (NED). Environmental and Social Summary Categorised FI, Sava Re was required to submit annual environmental and social reports to EBRD, and to comply with EBRD's Performance Requirement 2 (Labour and Working Conditions) and 9 (Financial Institutions). Technical Cooperation n/a - none Implementation Summary The project has been successful in achieving its main objectives of supporting Sava Re in raising equity capital under difficult market conditions to acquire Maribor and further consolidate the Slovenian insurance sector as well as to support development of insurance sector in former Yugoslav markets where insurance remains underdeveloped.