To partner with the largest private bank in Türkiye to on-lend to SMEs and small corporates who face working capital and liquidity constraints due to the COVID-19 pandemic.
This project will provide Türkiye İş Bankası A.Ş. (İşbank) with a credit facility. The loan is intended to alleviate working capital and liquidity constraints faced by SMEs and small corporates during the COVID-19 pandemic. Sub-borrowers benefiting from the facility may borrow up to USD 3 million for tenors 3-years or less for the purpose of “liquidity financing”.
AIIB’s Environmental and Social Policy (ESP) is applicable to this on-lending facility. The project has been placed in Category FI, because the financing structure involves the provision of funds through an FI, whereby AIIB delegates to İşbank the decision-making on the use of AIIB’s funds in so far as the sub-loans meet the eligibility criteria agreed with the Client. This includes the selection, appraisal, approval and monitoring of sub-loans, and the oversight on the sub-borrowers and sub-loans in line with AIIB’s ESP and Environmental and Social Exclusion List (ESEL).
İşbank will undertake an ES screening process for sub-borrowers and review sub-borrowers’ compliance with the applicable ES regulatory requirements. Sub-borrowers will be required to (a) demonstrate the compliance of their activities with applicable ES regulatory requirements and commit to maintaining that status during the tenure of the sub-loan, (b) represent not having recently been administratively or judicially determined to be materially in breach of applicable ES regulations, and (c) not be reported in mainstream or social media as materially contravening good ES practices.
The Project will support İşbank in increasing its lending to small and medium enterprises and small corporates and medium-low and low risk activities through short-term (less than 3-years tenor), limited scale (less than USD 3 million) liquidity and working capital loans under the COVID-19 Response Facility. All Category A and higher-risk Category B sub-projects inducing higher environmental and social risks, such as those involving a) involuntary resettlement, b) risk of adverse impacts on Indigenous Peoples, c) significant risks to or impacts on the environment, community health and safety, biodiversity, cultural resources, d) significant Occupational Health and Safety risks or e) significant retrenchment, as well as those to sub-borrowers engaged in high ES risk industries as determined in a pre-established list of industry sectors will not be eligible. No sub-loan proceeds will be used to finance project capex. Coal-related sub-loans including coal mining, coal transportation or coal-fired power plants, as well as infrastructure services exclusively dedicated to support any of these activities and large dams will also be excluded.
İşbank discloses key elements of its ESMS and environmental indicators for its own operations on its website: https://www.isbank.com.tr/en/about-us/our-policies. İşbank’s ESMS requires that it addresses third-party views, enquiries or concerns regarding its own ES processes and outcomes, as well as ES impacts and performances of its portfolio loans, as defined in its External Communication Mechanism (ECM). İşbank provides information for where ES inquiries and complaints can be filled. https://www.isbank.com.tr/en/contact-us.
Home What We Do Project List Türkiye: Türkiye Isbank COVID-19 Credit Line Project
