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EBRD Small

EBRD Small Business SupportBuilding stronger businesses

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Private sector development through a multi-tier approach

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Business know how in addition to financing

EBRD’s Small Business Support (SBS) team has been helping SMEs since 1993

SBS promotes good management in small businesses in the EBRD region, by providing direct assistance to individual enterprises, helping them to grow their businesses and become more competitive

SBS works on a not-for-profit basis, with two instruments: the Enterprise Growth Programme (EGP) and Business Advisory Services (BAS)

Market and sector development activities strengthen the local consultancy markets and disseminate sector best practices

SBS at a glance

Over €200m donor funding

1,800+ EGP projects

12,500+ BAS projects

Nearly 800 market development activities

Active in 25 countries

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EGP Brings International Know How BAS Fosters Local Expertise

• EGP supports the introduction of international best practice on a cost sharing basis

• SMEs with the potential of becoming future leaders in their market

• International advisors with at least 15 years of professional experience and expertise in the specific business sector

• Time horizon:12 – 18 months

• BAS assists individual enterprises to engage with local consultants on a cost sharing basis

• Specific projects with a rapid payback

• Aimed to increase the supply and quality of local advisory services

• Time horizon: 4 – 6 months

• Targeted market development activities to create a sustainable market of support for the SME sector

SBS eligibility criteria

EGP BAS

Ownership Majority privately- and domestically-owned

Size Usually between 50 – 1000 employees, turnover up to €50 million

Up to 250 employees (target group up to 50 employees)

Industry All sectors except banking and financial services, military products or services, gambling, tobacco and liquor.

Viability Acceptable debt structure depending on the industry and business type, sound accounting standards, ability to demonstrate potential growth

Integrity Enterprise and management must be credible and respectable

Maturity Operate from a minimum of 2 years

Management attitude

Management must be open and committed to achieve objectives and participation in the project costs.

Cost share Between 0% and 50% of total project cost (€50.000 on average), dependent on size and other investments

Between 25% and 75% of total project cost (€9.700 on average), dependent on size, location and type of service

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SBS combines international industry best practice with high quality local advisory services in diverse management areas to support the specific needs of local companies

TechnologyTechnologyStrategyStrategy OrganisationOrganisationOperationsOperations SustainabilitySustainabilityComputerised ManufacturingComputerised Manufacturing

Strategic PlanningStrategic Planning Human CapitalHuman CapitalProduct

DevelopmentProduct

DevelopmentEnergy

EfficiencyEnergy

EfficiencyIT Strategy & OrganisationIT Strategy & OrganisationInnovationInnovation Organisational

DesignOrganisational

DesignSupply ChainSupply Chain Clean Technologies

Clean TechnologiesAutomationAutomationBrandingBranding Corporate

GovernanceCorporate

GovernanceProcurementProcurement Energy AuditEnergy AuditEnterprise ArchitectureEnterprise

ArchitectureMarketingMarketing Risk Management

Risk Management

ISO 9000 - 27000

ISO 9000 - 27000

Green Operations

Green OperationsMISMIS

Pricing and Channel

Management

Pricing and Channel

Management

Transformation and Change

Transformation and ChangeHACCPHACCP Water and

WasteWater and

WasteTechnologyTechnologyStrategyStrategy OrganisationOrganisationOperationsOperations SustainabilitySustainability

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In search of a perfect crust: EGP team of experts are helping a Bosnian bakery to develop new products, improve quality and launch new equipment.CEO assessment “we have inspiration and workload enough for the coming two years”.

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Russia

Albania

SerbiaMontenegro

FYR Macedonia

BiHCroatia

Kosovo

A strong local presence in the Western Balkans

Extensive experience supporting over 4000 MSMEs in the Western Balkans

A deep local market knowledge based on 16 years of business presence

Local teams (over 30 specialists) across EBRD Resident Offices in the 7 countries

A network of over 600 local consultants across all business advisory segments and 1200 international industry experts

Established partnerships with local institutions and stakeholders

A support infrastructure, both in the field and at the EBRD headquarters in London

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A strong track record in delivering results and high impact projects

Active since 1996, BAS has implemented 3514 projects and EGP 512 projects in the Western Balkans

Utilised €55m of funding from bilaterals and the EU, matched with more than €16m in client contributions

72% of clients increased turnover, on average by 20%, as they expanded their business

SBS clients experience on average an increase of number of employees of 20% and a 30% increase in productivity

50% of clients experienced an increase in their workforce, contributing to the creation of 9,000+ jobs

20% of clients secured external finance for more than €800m

78% made repeat use of consultants at market cost to improve competitiveness and performance

SBS helps its clients in both pre and post investment stages to

make companies creditworthy and suitable for further investment

SBS clients in the Western Balkans received a total of €370 million of EBRD investments, both in debt and equity

SBS clients often obtain non-EBRD financing, such as through local commercial banks. In 2012, 15% of SBS enterprises received non-EBRD investments with a total value of €84 million

SBS closely cooperates with the EBRD LEF, for instance through improving financial reporting and accounting standards

Both a BAS and EGP client, a beverage manufacturer in Skopje received € 1 million from Stopanska Banka, and € 2 million from Komercijalna Banka

EBRD financing options for MSMEs

1. Indirectly: via local partner financial intermediaries FIs and through many FI MSME dedicated facilities, deployed across all countries. In Western Balkans FI partners include Banka Intesa, UniCredit, Societe General, Rheiffeisen, Opportunity Banka, Erste Banka etc.

2. Semi-indirectly: via co-financing mechanisms (e.g., the Medium-sized Co-Financing Facility (MCFF), available in ETCs

3. Directly: through several facilities created mostly in the context of the strategic ETC and WB Initiatives for direct “tailor-made” financing:

In the Western Balkans EBRD operates the Local Enterprise Facility (LEF) and the WB SE Direct Financing Facility (WeBSEDFF)

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Supporting financing needs of dynamic local enterprises

LEF Investment Criteria

Ownership domestic and foreign, but locally incorporated

Size Flexible, but LEF usually requires a min €5 mn in revenues and appropriate levels of debt and profitability

Industry All sectors except military products or services, gambling, liquor and tobacco. All investments must be in line with sound environmental principles.

Integrity Enterprise and management must be compliant with EBRD integrity rules.

Maturity Undefined, but start-ups require a strong corporate guarantor

Types of investments/ financing

Expansion, restructuring or acquisition/ equity, quasi-equity and debt

Size of investments Individual investments up to €10 mn

Target stake Minority stake, preferably in the range of 20% to 35% of the capital of the company

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SME Financing Provided Through Credit Lines to Local Banks

• Improve access to longer term finance for private enterprises for urgent capital investments, as well as working capital;

• Facilitate upgrades of SME operations towards EU production standards;

• Enterprises directly apply at the EBRD partner banks for these credit lines

• Loan conditions in line with market conditions

Who we work with in Western Balkans

Banca Intesa

Komercijalna Banka (Serbia)

Societe Generale

Hipotekarna Banka (Montenegro)

Unicredit Bank

Privredna Banka Zagreb

Alpha Bank Serbia

Erste Bank

Etc.

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SBS helps companies to grow and find the best investment options

• BAS and EGP build up managerial capacity, raise corporate governance standards, support MSMEs in developing and adapting their strategy;

• BAS Accounting Improvement Initiative supports introduction of IFRS and raising standards of financial management;

• SBS develops local consultants’ capacity through targeted trainings

• Business Matching Trips bring MSMEs in touch with partners and potential investors

• Initiatives such as Women in Business target audiences with specific needs

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