Wood Agency Credit Line

completed

Summary Of Project Information (SPI)Project NameBosnia and Herzegovina-Wood Sector Agency Credit LineRegionEuropeSectorProject No008344Projected Board DateJanuary 29, 1998Company NameN/ATechnical Partner and/or Major Shareholders N/AProject Cost Including proposed IFC investment Total project cost is DM 32.5 million (US$18.9 million equivalent), of which DM 25 million (US$14.5 million equivalent) will be for IFC’s own account.Location of project and Description of site The wood manufacturing enterprises are located in both Entities of Bosnia and Herzegovina.Description of Company and Purpose of Project The project comprises a 5 to 7 year IFC Agency Credit Line to be made available to expected 8-12 medium-sized wood sector manufacturing enterprises in both Entities (the Federation and Republika Srpska) of Bosnia and Herzegovina. The financing under the agency line would be mainly for working capital and spare parts to help in the early revitalization of the recipients’ activities. IFC’s investment will enable companies in the wood sector to revitalize their operations quickly. Since these companies are fairly labor intensive, they are major employers in their respective regions. Furthermore, in connection with this proposed investment, the local agent banks will expand their present limited range of activities and will be provided with training. As a result, the project will not only have a strong development impact on the wood processing sector, but will also have a positive impact on the financial sector. IFC’s agents will be four local commercial banks. It is expected that the agent banks will share a small portion of the risk in each sub-project through co-financing. It is also expected that there may be limited co-financing from external sources. There will be a significant technical assistance component of the project, for the enterprises as well as the banks in an estimated total amount of DM 2 million (US$1.2 million equivalent).Environmental Category and Issues This is a Financial Intermediary (FI) category project according to IFC''s environmental review procedure. The agent banks will be required to undertake an environmental review of eligible borrower''s environmental performance and each sub-project''s compliance with the BiH government environmental, health and safety requirements as well as applicable World Bank policies and guidelines. In addition, IFC will assess each agent bank''s capability to carry out environmental reviews. IFC will review and clear each subproject.Date SPI sent to PIC November 20, 1997     “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