EBRD Financial Institutions Portfolio
Financial Institutions: €6.7 billion *
as at December 2007
* Commitments outstanding
0500
1,0001,5002,0002,5003,0003,5004,0004,5005,0005,5006,0006,5007,000
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Bank Debt Bank Equity Equity Funds
Non-Bank FI Operating Assets
€ mn
Sector Distribution:
Continuing expansion of
segments and products
EBRD’s Objectives in the Financial Sector
Promote market-based financial institutions and a healthy and efficient financial services industry
Support private and entrepreneurial initiatives of both local and foreign investors and act as a catalyst to transition
Active policy dialogue with operators and authorities to strengthen regulatory/legislative frameworks and institutions
Apply best business practices and corporate governance in institutions
Be the leader in institution building
Bank Equity
Since 1992 EBRD has invested in
101 banks across 27 countries for
a total investment of €2.1bn.
Realised income from EBRD’s bank
equity investments totalled €1.9bn
so far.
As of December 2007, the portfolio
comprised participations in 49 banks
in 22 countries for a total investment
of €982.3m.
The fair market value of this portfolio is
€3.3bn, of which €2.4bn are unrealised
gains.
Cumulative and Outstanding Investments (€m)
0
500
1,000
1,500
2,000
2,500
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Cumulative Investments (€m)
Outstanding Investments (€m)
Number of Investments
0
20
40
60
80
100
120
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Cumulative Number of Investments
Outstanding Investments at Year End
Note: these figures do not include EBRD’s investments in microfinance institutions
Bank Equity Returns 1992 – 2007
Overall money multiple and IRR for all investments have been 3.22x and 28.79% respectively.
The average holding period for investments has been 5.5 years.
€ mill
ion
s
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
Investment Cost Total Investment Value
Fully Realised (FR) Partially Realised (PR) Unrealised (UR)
€6,542m
€2,016m
Overall MM 3.22x,
IRR 28.78%
UR 3.66x, 39.60%
PR 3.45x, 29.76%
FR 2.79x, 26.12%
€867m
€393m
€756m
€2,348m
€1,356m
€2,839m
Bank Equity Performance Over Time
Number of exits has remained constant over time,
ranging between 3 and 9 per year. In 2007, the EBRD made
4 exits from existing investments. Money multiple has increased steadily since 2000 reaching
an all-time high of 3.38x in 2006, and 3.23 in 2007 The average holding period for investments has been
5.5 years. IRRs have also increased over time, peaking in 2005 at
45.3% and remaining above average in 2007 at 28.79%.
Number of Exits
0
2
4
6
8
10
12
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Money Multiple
0 x
1 x
2 x
3 x
4 x
5 x
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
IRR
0%
20%
40%
60%
80%
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Total Over Period: 52
IRR for the Period: 28.79%MM for the Period: 3.23x
Bank Equity overall Performance and Returns 1992 – 2008 1Q
Overall money multiple and IRR for all investments have been 3.23x and 28.65% respectively.
The average holding period for investments has been 5.5 years.
€ mill
ion
s
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
Investment Cost Total Investment Value
Fully Realised (FR) Partially Realised (PR) Unrealised (UR)
€6,545m
€2,024m
Overall MM 3.23x,
IRR 28.65%
UR 3.72x, 39.60%
PR 3.45x, 29.76%
FR 2.71x, 26.12%
€867m
€393m
€764m
€2,347m
€1,356m
€2,842m
Insurance overall Performance and Returns 1992 – 2008 1Q
Overall money multiple and IRR for all investments have been 1.84x and 16% respectively.
€ mill
ion
s
0
100
200
300
400
500
600
700
Investment Cost Total Investment Value
Fully Realised (FR) Partially Realised (PR) Unrealised (UR)
€652.3m
€2,016m
Overall MM 1.84x,
IRR 16%
UR 1.84x, 18%
PR 0.91, -0.36%
FR 1.57x, 14%€60.1m
€42.1m
€281.7m
€94.6m
€38.3m
€519.5m
Equity Fund Returns 1992 – 2006
$2,785m $2,009m
$305m
$1,348m
$5,188m
$2,280m
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
US
D M
illi
on
s
Fully Realised (FR Including WO)
Partially Realised (PR)
Unrealised
Overall 2.03x, 21.07%
FR 2.27x, 20.37%
PR 4.42x, 32.81%
UR 1.39x, 15.98%
Investments at Cost $4,595m
Total Value $9,321mExcluding secondary sales
Investment Criteria
Selection of partners
Commitment to:
– Corporate governance
– Transparency
– Best practices and change
Alignment of interest
Success Factors
Institutional environment:– Rule of law
– Regulatory environment
– Supervision
Alignment of interests of stakeholders– Shareholders
– Management
– Authorities
– Clients
People and commitment to high professional standards Institution + capacity building and adapting to market dynamics