Kazan, December 1, 2006 – International
Finance Corporation (IFC) and Tatfondbank have signed an agreement for
cooperation to support the advancement of energy efficiency technologies
in Tatarstan. “This partnership will help stimulate sustainable private
sector financing of energy efficiency projects in the region by leveraging
the unique strengths of IFC as an international financial institution and
of Taftonbank as Tatarstan’s second largest bank,” said Miles Stump,
IFC Program Manager.
In February 2006, the State Council of Tatarstan adopted “Energy Efficiency
in the Republic of Tatarstan in 2006-2010,” a program that aims to promote
energy efficiency in the region. IFC and Tatfondbank will work together
to support the implementation of this program.
The cooperation agreement was signed within the framework of IFC’s Russia
Sustainable Energy Finance Program, funded by the Global Environmental
Facility, Denmark’s Environmental Protection Agency, Finland’s Ministries
of Foreign Affairs and Trade and Industry, and IFC’s Sustainable Financial
Markets Facility. An efficient start of the cooperation has become possible
as a result of the activities of the ‘Energy Efficiency – Volga Region’
subprogram, financed by the Free State of Saxony through its IFC Trust
The agreement paves the way for IFC and Tatfondbank to jointly design a
new financial product of the bank that will support the development of
energy efficiency projects. Along with financing, local enterprises will
benefit from IFC’s technical assistance and advisory services to help
them identify ways to save energy, become better informed about opportunities
to supply equipment and engineering services, and develop effective business
proposals for attracting financing for energy efficiency projects. “Ultimately,
this will enable enterprises to increase profitability while contributing
to the improvement of Tatarstan’s energy efficiency,” Mr. Stump said.
While energy intensity in Russia varies from region to region, the country’s
overall energy intensity is more than 6 times that of Canada and more than
12 times that of the UK. “Closing the energy efficiency gap would
directly benefit the Russian economy while also reducing pollution and
green-house gas emissions,” according to Mr. Stump. To help achieve
this goal, IFC developed the Russia Sustainable Energy Finance Program
which aims to stimulate sustainable private sector financing of industrial
modernization projects that improve energy efficiency. Within the framework
of the program IFC provides financing to Russian banks and leasing companies
in the form of long-term credit lines, to be used to finance industrial
modernization projects that produce substantial energy efficiency benefits.
This enables banks to provide long term financing (up to 5 years)
to enterprises at competitive market rates.
“The development of solid local financial institutions and promotion of
investments with sound environmental benefits is an integral part of IFC’s
overall strategy, as well as that of its donor partners. The cooperation
agreement with Tatfondbank is an important step in helping IFC, its donor
partners, and the Republic of Tatarstan achieve their strategic objectives
with respect to energy efficiency,” Mr. Stump said.
For the editor
Tatfondbank is a universal commercial bank and the second largest bank
in the Republic of Tatarstan and Volga region, having 72 outlets. According
to the INTERFAX’ Center for Economic Analysis, the bank rates 43rd among
the 50 largest federal Russian banks in the volume of assets.
The International Finance Corporation, the private sector arm of the World
Bank Group, is the largest multilateral provider of financing for private
enterprise in developing countries. IFC finances private sector investments,
mobilizes capital in international financial markets, facilitates trade,
helps clients improve social and environmental sustainability, and provides
technical assistance and advice to businesses and governments. From its
founding in 1956 through FY06, IFC has committed more than $56 billion
of its own funds for private sector investments in the developing world
and mobilized an additional $25 billion in syndications for 3,531 companies
in 140 developing countries. With the support of funding from donors, it
has also provided more than $1 billion in technical assistance and advisory
services. For more information, visit www.ifc.org.
IFC Russia Sustainable Energy Finance Program
The Russia Sustainable Energy Finance
Program is acting as a catalyst for energy efficiency market in Russia
by bridging project developers, financial institutions and vendors. It
has its focus on stimulating investments into energy efficiency by supporting
financial institutions in building targeted financial services.
The Program consists of two parts: investment and technical assistance.
IFC provides long term credit lines (up to 5 years) to banks and leasing
companies to be used exclusively for financing energy efficiency projects.
IFC supports those financial institutions and their clients by providing
consultations on technical, financial and legal issues, as well as holding
seminars on topics of financing energy efficiency.