FWC to support CEB in its technical appraisal and monitoring of operations in context of the COVID-19 pandemic

The FWC shall be performed through several assignments consisting of both field trips and desk-based work. Specific Terms of Reference will be prepared for each assignment under this contract, including the reporting modalities in consultation with the relevant Project Team members. The assignments will fall under one of two components, for which needed resources are below:

Module 3: Technical monitoring of COVID-19 line of financing for supporting MSMEs through financial intermediaries

Assisting TAM in reviewing COVID-19 project loans in the sector of supporting MSMEs, implemented through financial intermediaries (FIs), and to a lesser extent (only in multi-sectorial PFFs with an MSME support component) through central government bodies (e.g. Ministry of Finance) via on-lending through FIs (e.g. national development banks, commercial banks, leasing companies and microfinance institutions).

Task A: Carry-out a desk-review of the sectoral issues detailed below and confirm/discuss them further with Borrowers.

• Review the present situation regarding the demand side (issues and problems impacting the financial sector, the number of FIs actively engaged in MSME lending, demand and supply for loans, asset quality and other key performance indicators at the overall market level, etc.).

Task B: Meet/hold discussions with the Borrower’s officials in charge of implementing the CEB loan with the aim of presenting findings and independent expert opinion on the following:

• Institutional aspects: Business strategy, main target areas and focus, portfolio structure by business segments (e.g. large corporations, municipalities and other public entities, MSMEs, households), purpose of lending (e.g. investment, working capital, consumer finance, mortgages) with respective lending volumes with average tenor, types of assets financed (land, buildings, real estate development, machinery and equipment, vehicles, etc.), average interest rate of the portfolio, the Borrower’s present organization, operating policies, portfolio performance, funding structure with particular emphasis on their borrowing from IFIs.
• Project Implementation Arrangements: Review of the systems and procedures in place for allocating the CEB loan, monitoring and reporting arrangements, average tenor and interest rate of the CEB financed portfolio, identification and management of environmental and social risks.
• Socio-economic aspects: Review of key technical indicators agreed at appraisal (e.g. number of jobs maintained/created, regional distribution of end-borrowers, purpose of financing, gender composition of the financed portfolio, etc.
• Estimated timeline for future disbursements and eventual completion.

Task C. Review a sample (usually 3 or 4) of sub-projects financed through the loan for the following aspects:

• Ownership (form of incorporation, etc.),, main shareholders etc.
• Objectives and scope, including details on the sub-loan/lease.
• Financing plan identifying the level of CEB’s support for each sub-project.
• Implementation timetable and actual status of the investment (whether already in operation or not), whenever applicable
• Expected social benefits: number of jobs created and/or maintained and other relevant measures of social inclusion and social safeguard risks (e.g. those related to land acquisition, health and safety of workers and communities, etc.).
• Environmental aspects and risks (impact on environment and need for impact assessment, protective measures, energy savings if applicable, etc.).