1. Implementing financial instruments in Slovakia Programming period 2014-2020 Martin Polónyi Head of Department for Financial Strategy of Economic Growth Ministry of Finance of the Slovak Republic January 2016

2. 2 Implementation options

3. January 2016 3 Slovak Investment Holding New initiative proposed by the Ministry of Finance of the Slovak Republic to support national investment priorities → Centralised and more efficient implementation of ESIF via financial instruments  Mandate: Government Resolution no. 736/2013  ESIF allocation: min. 3% from each OP  Expected total allocation: approx. EUR 546m  Manager: SZRB Asset Management  Supervisory Board: nominees from Managing Authorities  Investment strategy: in line with OPs; proposed by the manager and approved by the SB  Mechanism: Fund of funds (CPR, AIFMD, Slovak Collective Investment Law)

4. January 2016 4 Governance Structure Level 1 Slovak Investment Holding SZRB Asset Management (SZRB AM) Financial Intermediaries Investor s 1) Manager after 2015 Slovak Guarantee and Development Bank (SZRB) Ministry of Finance of the Slovak Republic Projects / Final Recipients Level 2 Level 3 Slovak Guarantee and Development Fund (SZRF) – JEREMIE Public sector Private sector Key Infrastructure Fund Energy Efficiency Fund Waste Management and Energy Production Fund Social Economy Fund SME Fund Notes:1)Potential co-financing IFIs: EBRD, EIB, CEB, KfW, IIB; potential private investors: commercial and investment banks & equity investors

5. January 2016 5 Funding Agreements  Funding Agreements are 3-party contracts between SIH, SZRB AM and OP Managing Authorities stating the terms and conditions for making contributions from Operational Programs to financial instruments implemented via SIH  The key components include:  The amounts of ESIF and national co-financing allocations from each Operational Program  The conditions for the implementation and management of Financial Instruments  The investment strategy for the implementation of Financial Instruments  The rights and responsibilities of the three parties to the contract before, during and after Financial Instrument implementation  OP Integrated Infrastructure, OP Quality of Environment, Integrated Regional OP and OP Research & Innovation Funding Agreements (4 out of 5) were signed for a total of EUR 474m

6. January 2016 6 Potential Investor Participation Investment Type InvestorExamples of Investment Options LEVEL 1 Investments into sub-funds Limited Partner  Infrastructure Fund  Energy Efficiency Fund LEVEL 2 Financial intermediaries Financial intermediary  SME Fund  JEREMIE (First Loss Portfolio Guarantee (FLPG)  Portfolio Risk Sharing Loan (PRSL)  Energy efficiency loans LEVEL 3 Co-investment at project level Co-financing institution  D4R7  Renewable energy sources  Waste Management Fund

7. January 2016 7 SIH Sub-funds reflecting Investment Areas Financial Instrument Options Sub-funds OP Allocation for FIs Equity Mezzanine Soft Loans Guarantees Infrastructure Fund ✔✔✔✔ Energy Efficiency Fund ✔✔ Waste Management and Energy Production Fund ✔✔✔ SME Fund ✔✔✔ Social Economy Fund ✔✔✔ Total of all Sub-funds / Fund of Funds

8. January 2016 8 Steps Towards the Implementation of FIs (1/2) IN PROGRESS  Act no. 323/2015 on Financial Instruments which established a coordination body in the Ministry of Finanance of the Slovak Republic  Designation audits:  Managing Authorities  Coordination body  Update of the system of management of FIs  Guidance of the European Commission (EGESIF)  Selection process of financial intermediaries  New types of off-the shelf FIs (Equity fund for SMEs and start-up companies)

9. January 2016 9 Steps Towards the Implementation of FIs (2/2) 2016E IN PROGRESS  Selection of financial intermediaries through public procurement  The D4R7 Project: test of FIs in the area of infrastructure, in a PPP  Eligibility assessment, due dilligence, cooperation with EIB  EFSI  Transfer of resources in the SIH structure (in tranches)  Initiation of implementation of ESIF – allocation of resources to sub-funds and projects, management, monitoring, reporting, etc.  Financial Intermediaries select projects and commence implementation of FIs

10. Thank you for your attention!

11. 11 January 2016 Backup slides

12. January 2016 12 Sub-fundsAvailable FundsSample Proposed Projects  Project D4/R7 and various other road infrastructure projects  Modernisation of railway infrastructure projects  Construction and modernization of public port in Bratislava  Reducing energy consumption in public and residential buildings projects  Decrease in energy intensity of public buildings  Reconstruction / modernisation of public lighting projects  Primary school insulations Sub-funds (1/3) Infrastructure Fund Energy Efficiency Fund EURm

13. January 2016 13 Sub-fundsAvailable FundsProposed FIs  Early-stage equity fund  Growth-stage equity fund  Guarantee instrument  Interest subsidy risk- sharing instrument  Social impact Equity  Interest subsidy risk sharing instrument  Guarantee instrument Sub-funds (2/3) SME Fund Social Economy Fund EURm

14. January 2016 14 Sub-fundAvailable FundsSample Proposed Projects  Sewage system projects  Bratislava wastewater treatment plants and pipes  Composting and sorting plants  Waste to energy facilities Sub-funds (3/3) Waste Management Fund EURm