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, تركيب القرميد, تلبيس حجر –Renewable energy. –Ecotourism. –Organic Agriculture. –Waste Water Treatment. –Recycling. –Reducing Pollution.

3 Environmental Loans: Existing Circular Term % of RR Decrease Current Interest Value Interest Rate After Subsidy Currency 10 Years 200% - Term Deposits 0.19%≥ Interest on 2Yr. TBs. – 5.15% LBP Subsidized Environmental Loans 10 Years 200% - Term Deposits $1.15% / €1.74% ≥ 3 Mths. LIBOR / EURIBOR % FX 10 Years 100% - RR3%LBP Not Subsidized Environmental Loans 10 Years 200% - Term Deposits ≥ Cost of Funds + 2%FX

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.