UniCredit Bank Czech Republic and Slovakia and PGGM enter into €1.7 billion risk sharing transaction referencing the bank’s corporate loans portfolio

The transaction, referred to as “Project ARTS Morava” marks the debut of UniCredit Bank Czech Republic and Slovakia (“UniCredit CZ&SK”, the “Bank”) as issuer in the significant risk transfer (SRT) market. Project ARTS Morava is the first-ever directly issued credit-linked note by a Czech bank, and the first STS-compliant transaction in Czech Republic and Slovakia.

Project ARTS Morava is the result of the collaboration between UniCredit CZ&SK and Dutch pension investor PGGM. Its €1.7 billion reference portfolio consists of corporate exposures granted to clients in both Czech Republic and Slovakia. The capital structure includes retained first loss and senior tranches, and a second loss tranche purchased by PGGM on behalf of its client PFZW, the Dutch pension fund for the healthcare sector.
UniCredit Bank GmbH acted as sole arranger and placement agent for UniCredit CZ&SK.
The size of the transaction, the innovative structure and the resulting capital relief benefits, achieved both at Group and local level, confirm UniCredit’s strategy to increasingly use SRT as an effective tool to increase capital efficiency, with the ambition to expand it further to new asset classes and new legal entities in the Group in Central and Eastern Europe.
The transaction also includes ESG reporting, which reflects UniCredit CZ&SK’s commitment to sustainability and provides an accurate and transparent assessment of the ESG profile of its portfolio.
UniCredit has been a regular issuer of SRT transactions, successfully executing a considerable number of deals in Italy, Germany and CEE across several asset classes and in different formats. A commitment recently acknowledged with the nomination as Credit Portfolio Manager of the year at Risk.net awards.

The UniCredit Securitization & Asset Backed Solutions and Syndicate teams are recognized as a leader in the SRT market and has been awarded European Arranger of the Year in 2022 and 2024 at the Structured Credit Investor CRT Awards.

Maria Georgia Salagean, Chief Financial Officer at UniCredit Bank Czech Republic and Slovakia: “Our debut syntethic securitization marks a pivotal step in our commitment to capital efficiency and risk management. Morava is the successful outcome of a long journey and we are very proud we developed not only a highly efficient inaugural transaction but we as well established a platform for future SRT and supporting sustainable growth. SRT is a very efficient way for us to continue to support our customers throughout the Czech Republic and Slovakia, building on long term relationships and starting new ones. This notable success is also testimony to the high level of professionalism and great cooperation with PGGM, setting the basis for a long-lasting partnership.”

Luca Paonessa, Senior Director, Credit and Insurance Linked Investments at PGGM: “Project Morava extends the outreach of our mandate to a new geography, which offers particularly attractive diversification benefits to our pension fund client. It marks the start of what we hope will be a long-term relationship with UniCredit. UniCredit Bank Czech Republic and Slovakia is a dynamic organisation which has built a strong local brand while leveraging UniCredit Group’s banking experience. The STS qualification confirms UniCredit’s determination to pursue the highest standards in risk transfer. We are particularly proud of the introduction of line-by-line ESG reporting in Project Morava, which allows PGGM to track the development of the sustainability profile in the portfolio, in line with our belief that sustainability, risk and return are equally important dimensions of our investments”.

About UniCredit CZ&SK
UniCredit Bank Czech Republic and Slovakia is one of the strongest banks in the local market in the area of project, structured and syndicated finance, corporate finance and export finance. The bank has also built an extraordinarily strong position in acquisition financing and ranks first in commercial real estate financing.
UniCredit Bank is part of UniCredit Group, which operates in 13 European countries servicing over 15 million customers. As a controlled entity, UniCredit Bank forms a group with its sole shareholder, UniCredit S.p.A. as a controlling entity. UniCredit Bank is the controlling entity vis-à-vis its subsidiaries.

About PGGM
PGGM Investment Management is part of the Dutch not-for-profit pension fund service provider PGGM. It fulfills a social mandate: the sustainable investment of the pension capital of around three million participants of PFZW, the pension scheme for the Dutch health and welfare sector. On 30 September 2024, PGGM IM managed EUR 257 billion in public and private markets globally.