Institution details
ECO Trade and Development Bank (ECO)
Key facts
- Established in 2005
- Ownership: Public
- Cumhuriyet Mah. Silah?ör Cad.
- None
- https://www.etdb.org
Latest update: 03/12/2021
rating type | rating agency | type | rating |
---|---|---|---|
Institution rating | S&P | Foreign currency | N/A |
Products
- Loans
- Guarantees
- Equity
- Other products
Loans
- Project finance loan:
- Can be sovereign or non-sovereign
- In assessing the viability of the projects, ETDB establishes a reference minimum rate of return of 10%
- Maturity period: Typically, no more than 10 years, though a longer period can be considered in exceptional circumstances
- Grace period: Up to one-third of the length of the loan maturity
- Funds availability period: Up to 5 years - Corporate finance loan
- SME credit line:
- Sub-loans are provided on a commercial basis through client financial institutions incorporated in the respective member country
- Sub-loans are usually available with maximum maturities of 3–5 years and grace periods of up to 12 months (up to 24 months in exceptional cases) - Soft loan financing: Public sector loans extended only to the government of a member state
- Tenor: Maximum of 10 years
- Grace period: Maximum of 3 years
- Interest rate: Same as that approved by the board of directors for sovereign guaranteed loans (to be revised biannually)
- Fee and other charges: No more than 0.2% of the total amount" - Currencies: Any currency, including local currencies, or a combination of currencies in which ETDB is able to fund itself
- Repayment and tenors: Most loans will be medium- to long-term; maturity of the loans normally will not exceed 10 years
- Fees:
- Front-end commission fee: 0.5%–1%, payable in a single instalment between the time of signing and the first disbursement
- Commitment fee: 0.25%–1.5% for both variable-rate loans and fixed-rate loans
- Prepayment fee: Included in loan agreement
- Conversion fee: Conversion from one loan configuration to another may be subject to a fee
Guarantees
- Bid bond: Covers 1%–5% of the contract value
- Performance bond: Typically covers 5%–10% of the contract value, but may cover up to 30% in complex projects
- Advance payment bond: Covers entire amount of the advance payment (typically 5%–20% of the project cost)
- Loan guarantee/project risk guarantee
- Country risk guarantee: Covers up to 90% (100% in certain cases) of specific risks
- Stand-by letter of credit
- Fees and charges:
- Exposure fee (risk premium): Either a flat-charge fee (up to 8%) or a periodic fee (0.25%–6% per annum), payable every quarter
- Commitment fee
Equity
- ETDB generally prefers to use the below instruments for equity investments:
- Common stock
- Preferred stock
- Mandatory convertibles
- Common stock equivalent
-Exposure limit: 5%–25% (may be exceeded in the case of establishing a subsidiary)
- Total committed equity investment to any single obligor may not exceed 5% of paid-in capital - Although the rates for individual countries vary, ETDB generally looks for a real return on stand-alone equity investment of about 20%
Other Products
- Export finance facility: Provides financing for transactions up to 100% of the invoice amount if exported goods and services are produced in ECO member countries
- Import finance facility:
- If imported goods originate from other ECO region countries, up to 100% of the invoice amount can be financed
- If imported goods do not originate from other ECO region countries, up to 85% of the invoice amount can be financed