In this arrangement, IFC will offer a risk guarantee on a BRD portfolio of small and medium enterprise (SME) and corporate loans, valued at up to €700 million. The liberated capital, amounting to €315 million, will empower BRD to extend support to climate-related initiatives and women-owned smaller businesses. SRTs serve as a widely embraced tool for capital management in the banking sector. IFC has been instrumental in introducing such mechanisms in emerging markets, including Central and Eastern Europe. The redirected capital from these transactions can be redirected towards projects with robust developmental benefits.

Maria Rousseva, Chief Executive Officer of BRD Groupe Societe Generale, stated, “BRD is dedicated to fostering a sustainable economy in Romania, with environmental, social, and governance commitments forming the cornerstone of our strategy. Our track record demonstrates our increasing focus on positive impact finance. We are thrilled to collaborate with IFC on this new agreement, which will accelerate our efforts in this crucial domain.”

This transaction marks a milestone in the agreement inked in early 2024 between Societe Generale Group and IFC, aiming to enhance cooperation in expediting support for sustainable finance projects. While Societe Generale Group has already utilized SRTs to redirect capital towards sustainability-related lending, this marks the first instance of BRD employing such a tool.