BT agrees its first synthetic securitization deal

• The synthetic securitization is worth RON 2 billion (approximately EUR 400 million) and through it, the EIF, with the support of the EIB, reduces the credit risk for Banca Transilvania and allows the bank to redirect the capital allocated to the securitized portfolio.
• The transaction also entails a commitment by Banca Transilvania to provide SMEs with new financing of RON 2.64 billion for sustainable projects.
• Securitization reinforces its role as a tool that facilitates the redeployment of capital for new investments, thus contributing to job creation and a just transition to climate neutrality.

The European Investment Bank Group (EIB Group), consisting of the European Investment Bank (EIB) and the European Investment Fund (EIF), is strengthening its long-term cooperation with Banca Transilvania (BT) by approving a synthetic securitization and new lending commitments.

This is BT's first securitization transaction and represents the first capitalrelief transaction between BT and the EIB Group. The agreement aims to release capital allocated to a portfolio of assets subject to the standardized approach, thereby creating lending capacity that will be used to support SMEs and medium-sized companies in Romania. The EIF is providing protection for a tranche of over RON 324 million, which in turn is counter-guaranteed by the EIB. The EIF is also providing protection for a tranche of over RON 1.67 billion, of which 50% is counter-guaranteed by the EIB. The structure is drawn from a portfolio of micro, SME and corporate loans with a total balance of over RON 2 billion.

"I am pleased to see a new project in our collaboration with the EIB Group, accelerating access to finance for local SMEs, one of the pillars of the Romanian economy. In addition to strengthening the financing capacity, the EIB brings expertise and best practices, capabilities that help us to manage capital even more efficiently."
Ömer Tetik, Managing Director, BT

Under the agreement, BT commits to provide over RON 2.64 billion in new loans to SMEs and medium-sized companies over three years. At least 20% of this funding will be allocated to projects aligned with climate action and environmental sustainability, underlining BT and the EIB Group's commitment to support the transition to a low-carbon economy.

"This transaction with Banca Transilvania underlines our commitment to support Romanian businesses so that they can best grow in such challenging times. I am pleased that Banca Transilvania has relied on our proven expertise for their first securitization transaction and that together we are in a position to create new growth opportunities for the Romanian economy by leveraging securitization to promote sustainable investment."
Marjut Falkstedt, Chief Executive Officer. EIF

"EIB participation will be a signal to other international financial institutions and will contribute to the development of the Romanian capital market."
Ioannis Tsakiris, Vice-President. EIB.

Background information

About the European Investment Bank
The European Investment Bank (EIB) is the long-term lending institution of the European Union, owned by the Member States. EIB projects strengthen competitiveness, foster innovation, promote sustainable development, reinforce social and territorial cohesion and support a smooth and rapid transition to climate neutrality. The EIB Group, of which the European Investment Fund (EIF) is part, has signed financing commitments of EUR 88 billion for more than 900 projects in 2023. These commitments are expected to mobilize investments worth around EUR 320 billion, supporting 400 000 companies and 5.4 million jobs. All projects financed by the EIB Group are in line with the Paris Climate Agreement. The EIB Group does not finance fossil fuel investment projects. We are on track to deliver on our commitment to support EUR 1 trillion of climate and environmental sustainability investments in the decade 2020-2030, as promised in the Bank's Climate Roadmap. Over half of the EIB Group's annual financing supports projects that directly contribute to climate change mitigation, adaptation and a healthier environment. Around half of EIB financing within the European Union goes to cohesion regions, where per capita income is lower. This underlines the Bank's commitment to promoting inclusive growth and convergence on living standards.


About the European Investment Fund
As of 2 May 2024, the EIF is aligning its logo with the EU family, thereby reinforcing its role as a key EU actor. The European Investment Fund (EIF) is part of the European Investment Bank Group. Its core mission is to support micro, small and medium-sized enterprises (SMEs) in Europe by helping them gain access to finance. The EIF designs and develops venture and growth capital, guarantees and microfinance instruments specifically targeted at this market segment. In this role, the EIF contributes to the pursuit of key EU policy objectives such as competitiveness and growth, innovation and digitalization, social impact, skills and human capital, climate action and environmental sustainability and others.


About Banca Transilvania
Banca Transilvania is the largest bank in Romania and South-East Europe. As a universal bank, it covers all customer segments and business lines in the financial sector. It has over 20% market share, 4.3 million customers, more than 10,000 employees, online banking solutions and 500 branches in 180 locations. Banca Transilvania's brand value reached $686.5 million, ranking 252nd in the Finance Banking Brand Finance Banking 500 2024.