Romania's BRD Group, IFC launch low risk instrument to free up capital

BRD Groupe Societe Generale SA

04/04/2024 15:14

BUCHAREST, April 4 (Reuters) - The World Bank's
International Finance Corporation (IFC) will provide risk
guarantees of up to 700 million euros ($760.7 million) for
Romanian lender BRD Group Societe Generale  ROBRD.BX  under a
new synthetic risk transfer instrument which will enable more
green funding, the two banks said on Thursday.
    Significant risk transfer (SRT) transactions help banks
offload some of the risk on their loans, helping lenders reduce
the amount of capital they need to set aside to cover potential
losses. 
    The capital freed up by IFC will enable BRD,
majority-controlled by France's Societe Generale  SOGN.PA , to
lend up to 315 million euros to climate-related projects and
small businesses owned by women, the banks said.
    
($1 = 0.9202 euros)

 (Reporting by Luiza Ilie; Editing by Kirsten Donovan)
 ((luiza.ilie@thomsonreuters.com; +4021 527 0312; https://www.reuters.com/journalists/luiza-ilie;))