Banque du Liban Financing Unit. 2 Environmental Loans: Existing Circular Environmentally Friendly...
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Transcript of Banque du Liban Financing Unit. 2 Environmental Loans: Existing Circular Environmentally Friendly...
Banque du Liban
Financing Unit
2
Environmental Loans: Existing Circular
• Environmentally Friendly projects that aim to preserve the environment, i.e.:
– Green Architecture projects, landscaping, القرميد تلبيس , تركيبحجر
– Renewable energy.– Ecotourism.– Organic Agriculture.– Waste Water Treatment.– Recycling.– Reducing Pollution.
3
Environmental Loans: Existing Circular
CurrencyInterest Rate After Subsidy
Current Interest Value
% of RR
Decrease Term
Subsidized Environmental Loans
LBP≥ Interest on 2Yr. TBs. – 5.15%
0.19%200% - Term Deposits
10 Years
FX≥ 3 Mths. LIBOR / EURIBOR + 0.85%
$1.15%
/ €1.74%
200% - Term Deposits
10 Years
Not Subsidized Environmental Loans
LBP3%100% - RR10 Years
FX≥ Cost of Funds + 2%200% - Term Deposits
10 Years
4
MOU Between BDL and UNDP
Objectives:
• Development of technical cooperation in order to develop a vehicle to finance energy efficiency and renewable energy projects all over Lebanon. This vehicle is called National Energy Efficiency and Renewable Energy Account (NEEREA).
• Cooperation to involve international donors and organizations to support the NEEREA.
• Development of awareness among Lebanese commercial banks and end consumers.
5
MOU Between BDL and UNDP
Roles and Responsibilities of BDL
• Issuing related circulars for the setup of NEEREA.
• Overall financial management and quality control of the operations of NEEREA as per BDL procedures.
• Coordination with the Association of Lebanese Banks to deliver training and capacity building activities.
• Securing the financial stimulus through the exemption from reserve requirements.
6
MOU Between BDL and UNDP
Roles and Responsibilities of UNDP
• Ensure the positive participation of the Ministry of Energy and Water and the Ministry of Finance in the patronage of NEEREA.
• Cooperation with the Ministry of Finance to ensure the financial support needed to cover the collateral of the loans portfolio covered by NEEREA.
• Development of eligibility criteria for potential projects to benefit from the BDL incentive scheme.
• Ensure the technical validation of projects submitted to BDL through the Lebanese Center for Energy Conservation (LCEC).
• Certification of the potential projects submitted to BDL by the LCEC.
7
Grant Contract “Facility in Support of SMEs Energy Saving Investments
• The total amount of the action granted to BDL by the EU is €/12,200,000/ to encourage the investment of energy saving measures aiming to reduce at the same time negative environmental impact .
• If the project is presented within a sector not benefiting from the subsidy foreseen by Circular 80, a subsidy applicable to a loan duration of 10 years and equivalent to 15% of the loan requested.
• If the project is presented within a sector benefiting from the subsidy foreseen by Circular 80, a subsidy applicable to an extension of the loan duration extended by 3 years and equivalent to 5% of the loan requested.
• In addition, out of this € 12,200,000, a provision of € 200,000 will be made for technical assistance.
8
Environmental Loans: Draft Circular
• All green and energy saving projects within the Housing, Industrial, Tourism, Agricultural, Health, Education and Service sectors can benefit from the environmental loans whether they seek certification or not.
• Environmental loans will be extended to finance new environmentally friendly projects and to existing projects as well.
• Environmental loans that are not subsidized by the Lebanese Government may be repaid over a period of 10 years.
• Environmental loans that benefit from Government subsidy over a period of 7 years, would benefit from additional incentives in Required Reserve exemptions over the remaining 3 years to final maturity.
• Environmental loans that are guaranteed by Kafalat SAL, under a new scheme funded by the EU, with the following conditions:
– Amount of the Loans guaranteed up to $800,000.– Maturity of the loan is up to 15 years, of which 7 years will be subsidized by the Lebanese
Government, and the remaining period to maturity will benefit from additional incentives provided by BDL.