SB Thai NPL

completed

The Project is well-aligned with IFC’s Debt and Asset Recovery Program (DARP), a crisis response initiative that aims to create a programmatic and strategic response to the increasing DA in financial systems and thereby have a systemic impact on cleaning up the financial systems where build up of DA will occur. Board Approval for utilizing US$600mn of economic capital under DARP globally has been obtained. The East Asia Region (CEA) has been identified as a target for the initial implementation of DARP. The proposed investment will further mobilize investments by Standard Bank in partnership with IFC. In CEA, IFC plans to work with a group of select servicing companies and investors (Fanny Yang Tai, ACAP, Standard Bank) and provide financing currently not available due to traditional investors either exiting the market or facing liquidity constraints. The project would consist of a series of Senior Loan, Equity and Quasi Equity investments by IFC in pools of distressed assets located in emerging markets in the East Asia Region. It is anticipated that this exposure would be diversified across 3 to 5 transactions that would occur over a one year period. This exposure would be counted as part of the exposure approved to be taken under the Distressed Asset Recovery Program approved by the Board. The pools of distressed assets to be acquired and resolved under this Facility would be identified jointly by IFC and Standard Bank and would be required to meet certain objective criteria and their resolution would have to be carried out on the basis of servicing arrangements and standards that are acceptable to IFC. The details of these arrangements would be spelt out in a Memorandum of Understanding with Standard Bank that would serve as framework for this partnership. The commercial terms and its compliance with the agreed criteria of each transaction would be evaluated on a case to case basis. All transactions under this Facility would be consistent with the overall approach established for the DARP program.