Author: ilukacova
Company: MF SR

WESTERN BALKANS INVESTMENT FRAMEWORK

JOINT LENDING FACILITY

KEY PRINCIPLES

The Joint Lending Facility (hereinafter the “JLF”) is an informal and flexible arrangement between Partner International Financial Institutions (EIB, EBRD, CEB, hereinafter referred to as “IFIs”) within the Western Balkans Investment Framework (hereinafter the “WBIF). Its work will be coordinated by the partner IFI through the Project Financiers´ Group of the Joint Grant Facility (hereinafter the “JGF”), it being understood that the JLF and JGF form two complementary pillars of the WBIF. The JGF resources are intended to be used principally to support operations jointly financed by the institutions cooperating in the framework of the JLF.

The following are the key principles of JLF:

1.	In the context of the WBIF objective to coordinate and harmonise grant and loan instruments it is recognised that lending of more than one partner IFI, can bring important benefits to the region.

2.	Therefore, in the JLF the partner IFIs agree to take steps to increase cooperation on joint lending to priority projects, it being understood that such projects are at the heart of the integrated financing envisaged in the WBIF, as provided for in Article 1.4 of the JGF terms of reference. They will closely coordinate within the Project Financiers´ Group on the most appropriate structuring of the financial package, in particular maximizing the joint lending opportunities, to best cover the financial needs of each project in the interest of the client, in combination with JGF resources. The Project Financiers´ Group will ensure appropriate Beneficiary involvement in defining the JGF and JLF project packages.

3.	In the context of the Project Financiers´ Group tasks, IFIs will share their full Western Balkans pipeline of projects, for all sectors covered by the WBIF, and will form a common pipeline, dividing projects into the following four categories:
a)	Projects for IFI co-financing and potential grant support from the JGF, subject to agreement of the Project Financiers´ Group;
b)	Projects to be financed by only one IFI and for potential grant support from the JGF, subject to agreement of the Project Financiers´ Group;
c)	Projects for co-financing but outside the scope of the WBIF or not requiring grant support from the JGF;
d)	Projects to be financed by only one IFI and outside the scope of the WBIF or not requiring grant support from the JGF.

4.	Close working contacts on development of the pipeline will be maintained between relevant banking and management teams of the IFIs, within the Project Financiers´ Group work, in particular on category a) projects where a common approach to borrower/client relations and project preparation will be agreed.

5.	The foundation of the JLF has been the agreement between EIB and EBRD, which with reference to their joint lending alone, agreed that: 
(i)	they envisage an initial lending target of EUR 1 billion be set for priority projects on the basis of a 50/50 sharing at portfolio level with flexibility, as required according to the specificities of individual projects; and 
(ii)	once it is agreed by EC, and the partner IFIs to propose financial support for a particular project under the WBIF, a joint offer letter shall in principle be sent to the Beneficiary (or recipient) by the co-financing IFIs, also specifying the envisaged grant component. Negotiations will be conducted in close coordination.

6.	The key principles of JLF shall also be followed by European bilateral institutions of donors to the European Western Balkans Joint Fund as a condition for their possible participation in the WBIF and the related work of the Project Financiers´ Group.

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