BSTDB shareholders decide to increase subscribed capital by EUR 710 mln, paid-in capital by EUR 245 mln
The Board of Governors of the Black Sea Trade and Development Bank (BSTDB, Thessaloniki) at an extraordinary meeting on Friday decided to increase the bank's subscribed capital from the current EUR 2.29 billion to EUR 3.10 billion.
"As a result of the new subscription, the Bank will receive an additional capital of EUR 244.96 million, thus raising the paid-in capital held by the Bank to EUR 931.51 million," the BSTDB said on Friday.
The bank said that the paid-in portion of the newly subscribed capital will be 30%, with 70% callable – in line with the bank's current capital structure.
The BSTDB also said that the subscription covers 70% of the available authorized but unsubscribed capital and leaves unsubscribed 10% of the total authorized BSTDB capital of EUR 3.45 billion, which will remain available, inter alia, for potential new shareholders.
"The subscribed capital increase will enable BSTDB to fulfil the strategic objectives set forth in the Long-Term Strategy for 2021-2030 to promote economic development and regional cooperation of Member States and strengthen the bank's response capacity in crisis situations while increasing its relevance to shareholders," the bank said.
According to the bank, the subscription process will be finalized by the end of September 2022, and the BSTDB shareholders will make the subscribed capital payments in eight installments during the period of 2023-2030.
Additional capitalization of EUR 245 million for Ukraine will mean the payment of about EUR 5 million annually for eight years.
BSTDB is an international organization uniting 11 states of the Black Sea Economic Cooperation Organization. The shares of Turkey, Russia and Greece in the capital are 16.5% each, Romania - 14%, Ukraine and Bulgaria - 13.5% each, Azerbaijan - 5%, Albania - 2%, Armenia - 1%, Georgia and Moldova - each 0.5%. The Bank aims to support economic development and regional cooperation in the countries of the Black Sea region.
At the end of August this year, President of the bank Dmitry Pankin said that with the current capital of the BSTDB, its portfolio of projects of EUR 2.3 billion is also close to the ceiling, which is about EUR 2.6 billion.
According to him, additional capitalization increases the chances of raising the rating, which has been at the "A-" level (S&P) for a long time with a positive outlook.
"Such additional capitalization will show the rating agencies that the member countries are ready to help and support the bank," Pankin said.