Bucharest, Romania, May 14, 2019—IFC,
a member of the World Bank Group, was a key investor with a €50
million investment in the first covered bond issuance in Romania.
The first-ever and five-year maturity covered
bond will support the development of the capital markets and pave the way
for other issuers to use a new financial instrument to provide long-term
financing in Romania. Covered bonds are a critical tool for mortgage funding
in more developed markets as it allows mortgage lenders to issue debt instruments
better rated than the issuer.
Sergiu Oprescu, Executive President of Alpha
Bank Romania said “Almost 18 years after the launch of the first ever
mortgage loan in 2001, Alpha Bank Romania is opening a new chapter in the
Romanian banking market with this new funding tool, demonstrating once
again its pioneering capabilities”.
Romania’s housing finance system could contribute
more to economic growth than it presently does. The country’s 7 percent
ratio of outstanding residential mortgage debt to gross domestic product
is the lowest among EU countries, even lower than the emerging-market average.
The average for the 28-member block is 50 percent.
Vittorio Di Bello, IFC Regional Industry Head for Financial Institutions
Group in Europe and Central Asia said:
“IFC is one of the anchor investors in ABR’s covered bond issuance, thus
playing an important role in the Bank's efforts to diversify its funding
sources. Supporting the first covered bond issuance in the country and
a top banking player on the mortgage market will raise investors’ confidence
and pave way for other issuers to make use of this important instrument.”
IFC and Alpha Bank Romania
have a growing partnership in Romania.
Alpha Bank Romania is a systemically important bank, part of the Alpha
Bank Group, one of the leading banks in Greece. It became the first bank
to introduce mortgages in Romania in 2001 and is now one of the major mortgage
lenders in the country, with a portfolio that exceeds €1 billion.
In 2017, IFC provided a €50
million unsecured loan to support mortgage lending and help expand access
to finance for prospective home owners in the country. In
2015, IFC extended a $30 million credit trade line to Alpha Bank Romania
under its Global Trade Finance Program. IFC's support to the first ever
covered bond is expected to help the lender reach out to a greater number
of homeowners and further develop the local market.
About Alpha Bank Romania
Alpha Bank Romania, member of the Alpha Bank Group, is a leading financial
institution, active in the Romanian market for more than 25 years. The
Bank offers a diverse and modern range of services and products, both for
the retail and the corporate market. For more information, please visit
IFC—a sister organization of the World Bank
and member of the World Bank Group—is the largest global development institution
focused on the private sector in emerging markets. We work with more than
2,000 businesses worldwide, using our capital, expertise, and influence
to create markets and opportunities in the toughest areas of the world.
In fiscal year 2018, we delivered more than $23 billion in long-term financing
for developing countries, leveraging the power of the private sector to
end extreme poverty and boost shared prosperity. For more information,