EBRD was founded in 1991 to facilitate the transition of countries of the Central and Eastern Europe, including country-members of the former Soviet Union, with centrally planned economies to market economies and to encourage private initiative. To date, EBRD has 66 member- countries plus the European Union and the European Investment Bank. Cyprus is a founding member and participates in EBRD’s share capital.
EBRD’s Board of Governors has the decisive authority, in which each member country appoints a Governor and an Alternate Governor, stemming usually from the Ministry of Finance (i.e. the Minister and the Permanent Secretary, for respective positions), and to a lesser extent from the state/central banking authorities. The Bank’s headquarters are located in London, while the Annual Meeting of the Board of Governors takes place in a rotational manner in the various member states.
OPERATIONS OF EBRD IN CYPRUS
The Board of Governors, in the framework of its Annual Meeting in May 2014, decided unanimously, to approve the commencement of operations in Cyprus under the recipient country status for the period 2014-2020. The EBRD's strategic priorities in Cyprus are the strengthening of the financial sector to build up resilience and improve corporate governance, the support of the authorities’ privatization programme and the extended use of Public–Private Partnership (PPPs), and the support of business restructuring including financing and advisory services for small and medium-sized enterprises (SMEs).
The Bank, through its expertise and the financial tools it possesses, as well as through its investments in key sectors of our economy, has made a significant contribution towards the recovery and reform of our economy. Until mid-2017, the Bank has invested approximately EUR 220 million in the private sector of Cyprus, in areas such as the funding of commerce, infrastructure, transport and renewable energy sources.
More specifically, EBRD completed its first project in September 2014 with the Bank’s participation in the share capital of the Bank of Cyprus with the amount of €107,5 mln. In September 2015 a 5.4 % equity stake was acquired in Hellenic Bank amounting to an investment of €20 mln in new shares. EBRD stepped up its support for Cypriot exporters and importers with a €20 mln, €50 mln and €20 mln trade facility to Eurobank, Bank of Cyprus (BoC) and Hellenic Bank respectively, under the EBRD’s Trade Facilitation Programme (TFP) for a three year period. In November 2015, EBRD agreed to grant a US$ 11.4 million loan to Interorient Shipmanagement, a leading ship management company headquartered in Cyprus, to support the expansion of Interorient fleet, through a series of investments to enhance the company’s capacity to increase its client base.
In June 2016, EBRD also granted a €10 mln non-recourse debt financing for the construction, development and operation of five solar photovoltaic parks of total capacity 11.9 MWp. In the margins of 26th EBRD Annual Meeting and Business Forum in May 2017, which was held in Nicosia, EBRD and Cyprus have signed a €2.2 million agreement to strengthen small and medium-sized business (SMEs) support in Cyprus in order to increase their competitiveness and growth potential, with the extension of EBRD advisory role for further three years.