BAKU, Azerbaijan, January 13. The European Bank for Reconstruction and Development (EBRD) has signed a synthetic securitisation deal and new lending commitment with Bank Millenium, marking its second capital relief transaction in Poland, Trend reports.
Under this deal, the EBRD is providing credit protection of up to 66 million euros equivalent in Polish zloty (PLN) on a mezzanine tranche of a synthetic securitisation.
The portfolio behind the securitisation consists of small and medium-sized enterprise (SME) and corporate loans and factoring obligations originated by Bank Millennium. This transaction will help Bank Millenium enhance its capital resilience and free up lending capacity for the real economy. Additionally, the deal includes a ramp-up feature, allowing the bank to increase the size of the securitised portfolio after closing.
Bank Millenium will redeploy the capital relief achieved from the transaction to lend to SMEs and mid-sized companies, with 150% of the EBRD’s guarantee allocated to new green financing projects. These projects will align with the EBRD’s Green Economy Transition (GET) criteria and support Poland’s green transition, focusing on renewable energy and energy efficiency.
The deal complies with the European Union’s Capital Requirements Regulation and is designed to meet significant risk transfer (SRT) and simple, transparent, and standardised (STS) eligibility standards. This structure promotes transparency and raises transaction standards.
The EBRD aims to expand the use of synthetic securitisation in Poland, a market with significant potential for growth and innovation in risk management and capital allocation. The EBRD has invested nearly 15.4 billion euros in Poland, focusing on supporting a low-carbon economy and strengthening the role of the private sector, particularly SMEs.