Mitigating climate change together · to limit global warming to 2 degrees Celsius. It is not yet too late to avert the most dangerous consequences of climate change. But one thing

Mitigating climate change together

GCPF Annual Report 2012

Contents

Introduction: Greetings 3

Letter from the Chairwoman 4

Letter from the Investment Manager 5

The Global Climate Partnership Fund at a glance 6

The Fund’s Principles 8

GCPF Setup 9

GCPF’s Business Proposal 10

Development of GCPF since Inception 10

2012 Activities Report: Investments 12

Profile of GCPF’s Partner Institutions 14

Investment Portfolio 30

2012 Activities Report: Funding 32

Funding Situation 34

Leveraging Private Investors’ Resources 36

Investor’s Profile: ÄrzteVersorgung Westfalen-Lippe 37

Social and Environmental Report 38

Social and Environmental Management System 40

Energy and Greenhouse Gas Savings 2012 41

Summary of the Technical Assistance Facility activities 42

Financial Statements 40

Imprint | Contact information | Disclaimer 47

2 | | | |

Dear Reader, Sustainability is the key challenge for our and future generations. Today, we still have a chance to limit global warming to 2 degrees Celsius. It is not yet too late to avert the most dangerous consequences of climate change. But one thing is undeniable: To succeed, we need a global climate agreement. We need massive investments in reducing greenhouse gas emissions, not only in industrialised countries, but equally in emerging economies and developing countries. And we need all this now, not at some point in the future.

Activities and investments of the public sector alone will not be sufficient. We must achieve a substantial increase in private sector investment in climate and environmental protection. This is feasible. There are many current examples showing that sustainability is a promising business model. Where this is not yet the case, we must create the necessary framework conditions.

One way to mobilise climate finance is through public-private partnership models. This is why, together with KfW Bankengruppe, we established the Global Climate Partnership Fund (GCPF) three years ago. The Fund is a promising and innovative response to the question of how public and private sector engagement can effectively be combined. The GCPF is now past the start-up phase and further shareholders have joined the project. We are particularly pleased that the Fund has attracted its first institutional investor with private capital.

I am confident that this trend will continue, and that the GCPF will inspire many other successful initiatives in international climate finance.

Peter AltmaierGerman Federal Ministry for the Environment, Nature Conservation and Nuclear Safety (BMU)

Greetings

Introduction | | | | 3

Dear Reader,

I am pleased to present you the GCPF Annual Report for 2012. When looking back, this year can probably be considered as the break-through for the Fund as we reached several significant strategic objectives which were the reasons why GCPF was initiated in the first place.

Two years after the GCPF became operational, the Fund has a well diversified portfolio with a total size of USD 153 m. GCPF operates fully profitably and is able to pay the full target returns to all investors and even complimentary dividends to mezzanine and senior tranche investors.

More importantly in terms of climate change, however, our partner institutions scaled up their on-lending activities and started to generate significant CO

2 savings. The mix of

different institutions we have provides a bright range of activities which we further portrayed in this report and allow for interesting insights into the different banking business models embarking on green lending.

Thanks to the excellent achievements in 2012, we also recorded a strong investor appetite from both the public and private sector. We are very proud that, already in 2012, a private sector investor allocated USD 30 m to the GCPF, thus being ahead of the curve with regards to sustainable investments combating climate change in emerging and developing countries. In addition, we expect further new investors to support the growth of the GCPF throughout 2013.

The leverage of public money through private investments was a key priority of the Global Climate Partnership Fund and therefore adding a private investment marks a milestone in the development of the Fund.

We also increased our presence in our target markets, participating in conferences and engaging in dialogues with leading institutions to raise awareness of what GCPF is aiming to do and is already accomplishing.

I believe we can be proud of the achievements of the past year and are looking forward to a successful 2013 where we intend to welcome new partners into our C-Shares, further build up our portfolio and further work on integrating the private sector in the fight against global warming.

Monika BeckChairperson of the Board of Directors

Letter from the Chairperson

4 | | | | Letter from the Chairperson

Dear Reader,

From the Investment Manager’s perspective, 2012 marks the year in which the Global Climate Partnership Fund matured in multiple ways, namely in the composition of its funding and portfolio mix, its profitability, and finally in the recording of CO

2 savings.

On the funding side, we added significant private investments to the Fund. The fact that, with ÄrzteVersorgung Westfalen-Lippe, a professional investor signed notes at this early stage in the Fund’s life is a strong signal that the public-private partnership for climate change mitigation can work. This year will also be the first in which the GCPF can pay out target dividends and complimentary dividends. These are the key to attracting further commercially oriented investors.

The foundation for this was a further diversification of the portfolio, containing investments on all our target continents now and being composed of banks pursuing different business models. In addition, GCPF made its first direct investment: a small photovoltaic plant in South Africa was financed, replacing diesel generators and contributing to a cleaner local energy use. This contributes to a continuous improvement of the risk-return profile of the Fund which remains important in order to tap the private sector further. At the same time, we see the Fund very well positioned as a sustainable investment opportunity due to the GCPF’s own standards and based on an intensive, direct interaction with the investees of the Fund – which makes the difference between mere financial investments and impact.

Finally, we are in detailed discussions with our partner institutions, shareholders and further stakeholders to develop a clear and comprehensive framework to record and account for carbon savings which we are still improving and finalizing. We believe that bringing transparency and clarity to the accounting of greenhouse-gas savings will be a significant step to introducing practicable standards within the green lending community. These standards will help green investors and partner institutions to simplify their measurement and verification process and scale up their activities.

We are looking forward to another successful year and hope you will enjoy reading this report.

Michael Schneider Michael Hölter Susanne Kern Matthieu Klinker

Deutsche Bank AG, Environmental & Social Capital

Letter from the Investment Manager

Letter from the Investment Manager | | | | 5

Presentation of the Global Climate Partnership Fund

Mission

Global climate change and energy security are among the key challenges of the 21st century. Due to strong economic growth, energy consumption will increase rapidly in emerging and developing countries, leading to further negative consequences for the environment. The mission of the Fund is to contribute to the mitigation of climate change through a reduction of greenhouse gas emissions. The Fund fosters primarily energy efficiency and renewable energy investments for SMEs and private households in the target countries via qualified financial institutions or directly, thereby contributing to the reduc-tion of primary energy consumption.

6 | | | | The Global Climate Partnership Fund

MWh annual energy savings from projects funded in 2012

75,221

The carbon impact figures on this page have been restated as of Q2 2015. See page 41 for more details.

The Global Climate Partnership Fund | | | | 7

49.1 %Average percentage of CO2 savingsof GCPF funded projects in 2012

The Fund’s Principles

Sustainability Additionality

For GCPF sustainability means uniting economic and ecological reasoning in order to create a lasting impact in both fields. By financing eco-nomically sound investments, the fund allows for a revolving use of its means. The fostering of investments for SMEs and private households via local financial institutions or directly supports the creation of employment. Through the intro-duction or enhancement of innovative climate change-oriented loan products by local banks, GCPF further assists the development of the financial sector. By prioritizing countries and projects show-ing the highest potential for reducing the energy related impacts on the environment, be it in the consumption or production of it, GCPF actively pursues its environmental objectives.

By observing the concept of additionality, GCPF provides resources to areas which are currently experiencing a lack of appropriate financing resources. Consequently, GCPF does not intend to provide resources in areas where the private sector can already satisfy the financing needs of sustainable energy investments, nor does it seek to compete with subsidized investments. Instead it strives to provide financial resources in areas which do not require subsidies in order to unleash their potential but are currently insufficiently served by private financiers.


GCPF Setup

Governance Structure

The Board of Directors appoints the Investment Committee which approves investment decisions proposed by the Investment Manager and monitors the other activities of the Investment Manager.

The Investment Manager conducts the Fund’s busi-ness on behalf of the Board of Directors and the Investment Committee. The Investment Manager also manages the Technical Assistance Facility at arm’s length, an activity overseen by the Technical Assistance Facility Committee.

The Technical Assistance Facility Committee repre-sents the Facility’s Donors and the Investment Com-mittee, in order to ensure that the Fund’s technical assistance directly supports the Fund’s objectives and investment activities.

Geographic Scope

Initially starting with thirteen target countries (Bra-zil, Chile, China, India, Indonesia, Mexico, Morocco, South Africa, the Philippines, Tunisia, Turkey, Ukraine and Vietnam), GCPF today invests into any emerging and developing countries approved by the Investment Committee. Investments in coun-tries highlighted on the map above are considered.

Target Countries

The Fund’s shareholders are represented by the Board of Directors, which oversees the Fund’s activ-ities and is responsible for strategic decisions. The Board of Directors is the legal representative of the Fund. In compliance with GCPF’s founding documents and applicable laws and regulations, it has exclusive power to administer and manage the Fund.


GCPF’s Business Proposal

How to qualify for GCPF funding

Requirements for financial institutionsTargeted are Tier 2 and 3 banks in more developed financial markets and Tier 1 banks in less devel-oped financial markets. They should:

• Present a business plan for financing sustai-nable energy projects or a suitable pipeline

• Have a social and environmental management system or be willing to implement one

• Require financing between USD 5 m and USD 30 m

Requirements for energy efficiency projects• Present a complete business case including

anticipated energy and financial savings• Major contracts should be signed or close to

signing (e. g. EPC, O&M, permits & licenses)• Require USD 5 m to USD 20 m in debt

Requirements for renewable energy projects• Be in late development stage, major contracts

should be signed or close to signing (e. g. PPA, EPC, O&M, land rights, permits & licenses)

• Equity sponsors should be lined up• Project must classify as a Category B or

Category C project under the IFC Performance Standards (e. g. maximum size of wind projects 50 MW)

• Require USD 5 m to USD 20 m in debt

Development of GCPF since Inception2009 20112010

DECEMBER

GCPF was created and initially capital-ized with seed money from the German Federal Ministry for the Environment, Nature Conserva-tion and Nuclear Safety and KfW Development Bank

MARCH

Tender process for the selection of Investment Manager was launched

AUGUST

Deutsche Bank was appointed as Investment Manager and commits the first private investment to the fund

NOVEMBER

Initial negotiations with potential partner institutions

APRIL

Şekerbank joins GCPF as its first partner institution

MAY

IFC and the Danish government join GCPF as investors


Investment process

20132012

OCTOBER

The first project of the TA Facility for a financial product development in Ecuador begins

DECEMBER

Vietinbank and Banco Pichincha join GCPF as new partner institutions

MARCH

Ukreximbank and Banco ProCredit join GCPF as new partner institutions

SEPTEMBER

Banco Pine joins GCPF as new partner institutions

DECEMBER

ÄrzteVersorgung Westfalen-Lippe invests into GCPFXacBank joins GCPF as a new partner institution. The first direct investment, the South African Cronimet PV plant, is closed

Initial screeningDeutsche Bank (DB)

due diligence

Preparation of Investment

Committee

Preparation of financial closing

Decision to start detailed due

diligence (DD)

Investment Committee

approval

• Provision of a business plan

• Portfolio fit assessment

• In case initial screening is positive, detailed DD to be initiated

• Further invest-ment details required

DB conducts review incl.:

• Political and economic risk analysis

• Financial evaluation

• Social and environmental assessment

• On-site visit

DB prepares an investment proposal based on the due diligence to be presented to GCPF’s investment committee

• Negotiation of legal documentation

• Disbursement of funds

• Arranging of technical assistance if applicable

8 weeks – 6 months


Ecuador

$ 25 m Subordinated loan

to Banco Pichincha, Senior loan to Banco ProCredit

Brazil

$ 30 m Senior loan to

Banco Pine

South Africa

$ 2.8 m Debt financing of

Cronimet Photo-voltaic Plant

Throughout the year, GCPF disbursed a total of USD 102.8 million to 6 partner institutions. Further USD 5 million are committed and three technical assistance projects were launched.

2012 Activities Report: Investments

12 | | | | Portfolio Analysis

Indonesia Feasibility study for a hydro project

Turkey


Şekerbank

Mongolia


XacBank

Vietnam


Vietinbank

Ukraine


Ukreximbank

China Feasibility study for a waste-to-energy project

The Philippines In-depth country study for local clean energy finance

Portfolio Analysis | | | | 13

(1) International Monetary Fund, World Economic Outlook Database, October 2012

(2) Millennium Develop-ment Goal Indicators 2012, United Nations Statistics Division

Profile of Banco PichinchaBanco del Pichincha is Ecuador’s largest private bank with about 27 % of the system’s assets as of June 2010. The Bank operates a network of 227 branches nationwide, and conducts operations in Peru, Panama, the United States and Spain. The company offers a wide array of services to corporate (26.5 % of loans), consumer and mortgage (38.1%),

and SME / microcredit customers (35.2 %). The bank operates as a subsidiary of the Grupo Financiero Banco del Pichincha, the largest financial group in Ecuador, which is also active in leasing, insurance, brokerage, fund management and warehousing. Pichincha is privately owned by its main share-holder Fidel Egas Grijalva.

KEY FIGURES

Banco Pichincha Ecuador

Total assets (USD) 6,088,501,912 Population (m) 1 15.014

Total equity (USD) 668,966,291 GDP at PPP (USD bn) 1 127.42

Net income (USD) 96,520,507 GDP at PPP per capita (USD) 1 8,486.91

Net income / Total equity 14.43 %GDP growth 2011 (constant prices, local currency) 1 7.8 %

Net income / Total assets 1.59 % Total CO2 emissions (thousand metric tons) 2 30,102

Equity / Total assets 10.99 % CO2 emissions per capita (metric tons) 2 2.11

Source: Banco Pichincha’s 2011 – Annual Report

14 | | | | 2012 Activities Report: Investments

Ecuador

Sources: (1) Classification scale

comprises categories A (significant exposure in high risk industries), B (significant exposure in medium risk indus-tries) and C (predomi-nantly active in low risk industries)

Green lending activitiesBanco Pichincha had limited experience in green finance when it received GCPF’s USD 15 million loan. In 2012, it made a concrete leap forward and started successfully extending green loans in support of energy efficiency and renewable energy projects, focusing on SMEs. Amongst other pro-jects, Pichincha financed the installation of ovens

and steamers that significantly boosted the effi-ciency of cane juice processing and transformation into sugar or the shift from LPG to natural gas from local manufacturers’ pottery kilns. Banco Pichincha also entered into renewable energy schemes in the hydro and wind sector.

SOCIAL AND ENVIRONMENTAL MANAGEMENT SYSTEM

Compliance with GCPF’s social and environmental exclusion list Confirmed by bank on March 1, 2013

Maintenance of a social and en vironmental management system Confirmed by bank on February 28, 2013

Major issues identified in 2012 None

Results of public domain screenings None

Social and environmental categorization 1 Category B

Pursuance of a corrective action plan No

2012 Activities Report: Investments | | | | 15

1) International Monetary Fund, World Economic Outlook Database, October 2012

2) Millennium Develop-ment Goal Indicators 2012, United Nations Statistics Division

Profile of Banco PineFounded in 1997 and headquartered in São Paulo, Brazil, Banco Pine is focused on establishing and maintaining long-term relationships with large cor-porate clients and investors. The bank develops a strategy of product diversity, tailored to meet the needs of each client and fosters long-lasting rela-tionships and mutual benefits with the 600 groups it serves. Ranked as the 9th largest Brazilian bank in terms of credit offering to large corporations, the 15th largest bank in Brazil offering corporate credit, and, once again, one of the 15 largest players in derivative transactions and the 2nd largest in com-modity derivatives according to Cetip (OTC Clearing House), Banco Pine operates 10 branches in Brazil,

one branch in the Cayman Islands and inaugurated a broker dealer in New York in November 2012. Cor-porate credits accounted for, approximately, 60 % of its revenues in 2012. The other 40 % comes from products and services complementary to credit: PINE Investimentos-Investment Banking unit, FICC (Fixed Income, Commodities and Currencies) – that provides risk management products and hedging solutions on interest rates, currencies, and com-modities to help clients manage the risks on their balance sheets, and Treasury. Listed on Sao Paulo’s stock exchange (BM&FBOVESPA) since 2007, under ticker PINE4, the bank has development agencies DEG and Proparco among its shareholders.

KEY FIGURES

Banco Pine Brazil


Total equity (USD) 597,163,836 GDP at PPP (USD bn) 1 2,294.18





Source: Banco Pine’s 4Q12 Earnings Release and 2012 Financial Statements. FX conversion rate BRL / USD by the end of 2011: 2.0429


Green lending activitiesIn 2012, Banco Pine was nominated as Latin Ameri-ca’s most green bank by the IFC for its achievements under IFC’s Global Trade Finance Program and its long-standing financing of renewable energy and ethanol companies. Around 50 % of Banco Pine’s portfolio was distributed among companies in the sugar and ethanol, electric and renewable energy, infrastructure, construction and agriculture sectors in 2011. The bank increased its participation in the renewable and electric sectors in the third quarter of 2012, from 8 % to 13 % of its loan portfolio. The USD 30 million 7-year senior unsecured loan extended by the GCPF allows Banco Pine to support

its strategic goals in refinancing energy efficiency investments as well as power co-generation pro-jects.

Banco Pine also joined the UN Global Compact and adopted the Equator Principles in 2012. The Global Compact mobilizes the international business com-munity to adopt fundamental and internationally accepted values in terms of human rights, labor and environment issues. The Equator Principles constitute a set of standards that allow financial institutions to assess environmental and social risks in project finance transactions.


Compliance with GCPF’s social and environmental exclusion list Confirmed by bank on January 31, 2013

Maintenance of a social and en vironmental management system Confirmed by bank on January 31, 2013





Brazil

Sources: (1) Classification scale

comprises categories A (significant exposure in high risk industries), B (significant exposure in medium risk indus-tries) and C (predomi-nantly active in low risk industries)


Sources: (1) International Monetary

Fund, World Economic Outlook Database, October 2012


(3) Classification scale comprises categories A (significant exposure in high risk industries), B (significant exposure in medium risk indus-tries) and C (predomi-nantly active in low risk industries)

Profile of ProCredit Ecuador Launched in 2001, Banco ProCredit belongs to ProCredit Holding, a German group of 21 banks, which promotes access to financial services in developing countries. At the end of 2012, ProCredit Ecuador had 858 employees serving 232,800 cus-tomers through a network of 40 branches estab-lished in 19 cities. It is a development-oriented full service bank focused on providing loans to SMEs and micro lenders. It also has a firm commitment

to bundling responsible financial services with financial education in order to prevent borrowers’ over-indebtedness. Banco Procredit’s loan port-folio increased by 10.2 % from USD 367 million in 2010 to USD 388 million in 2011. The trade sector accounted for the greatest share of its port-folio with 37.3 %, followed by services (34.3 %), agriculture (13.2 %), industry (11.1 %) and other sectors (0.7 %).

Green lending activitiesAccompanied by the development of an environ-mental management system designed both for loan screening and monitoring purposes, Banco ProCredit is working towards the launch of a ful-ly-fledged green loan program. To support these worldwide efforts, the holding built up in-house capabilities. In 2012, Banco ProCredit channeled GCPF’s funds through small loans, primarily towards financing cleaner vehicles in the trans-portation sector.

KEY FIGURES

ProCredit Ecuador

Total assets (USD) 447,475,000 Population (m) 1 15.014






Source: ProCredit Ecuador’s2012 unaudited financial statements


Compliance with GCPF’s social and environmental exclusion list

Confirmed by bank on January 29, 2013

Maintenance of a social and en vironmental management system



Results of public domain screenings

None

Social and environmental categorization 3

Category C



Ecuador

KEY FIGURES

Sub-loan Climate Metric

Loan size (USD) 1 300,000 Annual CO2 Saving (tons) 2 480

Disbursement Date During 2012 Lifetime CO2 Saving (tons) 3 7,200

Taxi Upgrade Program

BackgroundTransport figures are prominently on the green growth agenda given the major environmental impact of traffic in terms of greenhouse gas emis-sions, local air emissions and noise. In its endeavor to enact climate change stemming policies, the government of Ecuador has followed many coun-tries and introduced a car scrapping scheme. Being economic stabilizers in periods of economic down-turns, such schemes also catalyse the reduction of C02 emissions. Indeed, these programs stimulate consumer spending in the automobile industry

and spark the replacing or removal of poorer per-forming older vehicles. For Ecuador, this results in a reduced dependence on foreign oil refinery capacities, reduced CO2 emissions, better air qual-ity and increased road safety.

The Government of Ecuador has made the scrapping process a mandatory step in its nationwide financ-ing program to upgrade taxis. Banco ProCredit has decided to support this initiative by financing taxi upgrades through targeted loans.

Project InformationBanco ProCredit has a long commitment to financ-ing small entrepreneurs and increasingly strives to advocate for environment preservation. The replacement of taxis under the taxi upgrade pro-gram and scrapping scheme is just one opportunity to renew ageing assets while offering improved services to the population amongst many. Banco ProCredit aims to finance a fleet of 30 taxis. At an average travel distance of 200 km per day, it is estimated that each taxi currently in circulation

in Ecuador consumes around 9.23 gallons of fuel per day. The four taxi models eligible under the upgrade scheme (Nisan Sentra, Kia R, Chevtaxi, and Kia Excite) consume on average 4.17 gallons per day to cover the same distance. This is a 55 % consumption reduction compared to the existing models and an estimated saving of 16 tons of CO2 per annum per taxi. Thus, the taxi replacement is a good representative of the other products ProCredit finances which include bakery ovens, tractors, solar panels of biodigesters.

(1) Assuming 30 taxi upgrades and USD 10,000 loan per upgrade.

(2) Assuming 30 taxi upgrades and each upgrade save 16 tons of CO2 per annum.

(3) Assuming 15 years of lifecycle.









None



KEY FIGURES

Şekerbank Turkey


Total equity (USD) 777,104,081 GDP at PPP (USD bn) 1 1,075,47

Net income (USD) 86,418,656 GDP at PPP per capita (USD) 1 14,392,52


Net income / Total assets 1.11 %Total CO2 emissions (thousand metric tons) 2 299,106.10

Equity / Total assets 10.02 %CO2 emissions per capita (metric tons) 2 4.2

Source: Şekerbank’s 2011 Annual Report. FX conversion rate TRY / USD by the end of 2011: 1.9018





Profile of ŞekerbankŞekerbank was created almost 60-years ago and today has a strong footprint throughout the coun-try. It is Turkey’s 14th largest bank, and specializes in niche markets, especially in the SME and retail sectors. It operates through 272 branches that reach 70 cities and 204 districts. Its customer base exceeds one million clients. Increasing its loan volume to

8.7 billion TL with a growth of 16 % on an annual basis, Şekerbank serves over 88 thousand people in 2011, with loans constituting 60 % of its total assets. Şekerbank’s vision is to become the lead bank with regards to financing small businesses while ranking among Turkey’s top ten private banks in terms of total assets.

Green lending activitiesŞekerbank’s pioneer status in the green lending segment of the Turkish banking market positioned it ideally to quickly address the strong demand for energy efficiency products. By January 2011, namely one year and a half since its launch in May 2009, Şekerbank’s EKOkredi had channeled TL 260 million. 325 SMEs, 9,515 individual clients, as well as 2,551 farmers and small businesses benefited from the favorable financing conditions provided by EKOkredi. Additionally, under the umbrella of EKOkredi, the ECO Loan Insulation program allowed for the insulation of 13,000 dwellings and provided a total of TL 27 million in financing to date. In 2011 alone, Şekerbank extended over TL 310 million in loans with the EKOkredi program and thereby helped introduce more than 25,000 customers to the concept of energy savings. GCPF’s loan directly

contributed to financing the EKOkredi portfolio. In 2012, Şekerbank’s EKOkredi product has been selected to represent Turkey in the Rio+20 United Nations Conference on Sustainable Development. It was the only project from the finance sector.


Turkey

KEY FIGURES


Loan size (USD) 1 13,244,087 Annual CO2 Saving (tons) NA

Disbursement Date 2011 – 2012 Lifetime CO2 Saving (tons) 2 NA

Building Envelop Improvements

BackgroundWith buildings estimated to account for some 40 % of energy use globally, the potential contribution of effective insulation to improved energy efficiency in our homes and offices – and hence to lower CO2 emissions – is significant. Şekerbank has seized this potential and offers its customers a range of loan schemes in the field of sustainable energy. A majority (approx. 80 %) of the loans funded by GCPF’s facility finances residential properties’ enhanced insulation, which includes window, wall

and roof insulation as well as the installation of efficient appliances, for instance.

In concrete terms, the property owner receives a loan from Şekerbank to pay a certified building company according to the project’s percentage of completion. A professional association ultimately controls the quality of the work performed by the building company.

Project InformationŞekerbank offers a comprehensive and stream-lined service pack. It counsels its clients ahead of a visit that will enable them to establish a proposal, encompassing the technical specifications of the project. A quality approval by a certified third party follows this first step, which precedes the formal loan application. If accepted, the loan finally pays the insulation work.

As of December 2012, more than 400 building envelop improvement projects had been financed by Şekerbank thanks to the GCPF facility. The total outstanding loan amount amounted to approx. USD 13 m.

(1) Represent total out-standing subloans in building envelop improvements as of 31 December, 2012

(2) Assuming 15 years of lifecycle

NB: The carbon impact figures on this page have been restated – or deleted where recalculation was not feasible – as of Q2 2015.

See page 41 for more details.









None



KEY FIGURES

Ukreximbank Ukraine


Total equity (USD) 2,185,965,601 GDP at PPP (USD bn) 1 329.33



Net income / Total assets 0.18 %Total CO2 emissions (thousand metric tons) 2 277,756.60


Source: Ukreximbank’s 2011 Annual Report. FX conversion rate UAH / USD by the end of 2011: 7.8950





Profile of UkreximbankUkreximbank is a 100 % state-owned public joint-stock company and the largest Ukrainian bank by authorized equity capital. Its mission is to facilitate the development of Ukraine’s economy and of its customers’ operations, mainly in export-oriented and import-substituting sectors through lending and transaction services. It is currently the only Ukrainian financial institution entitled to fulfill the functions

of Financial Agent of the Government of Ukraine. It operates 29 branches and 96 outlets throughout the country. Ukreximbank counts about 1,280,000 individual customers and over 59,500 corporate clients, holding a 7.6 % market share in corporate loans. Going forward, Ukreximbank seeks to expand its SME client base, which amounts to 28 % of its total loan portfolio (vs. 70 % for corporates).

Green lending activitiesUkreximbank has concluded numerous partnerships with international organizations focused on moder-nizing Ukraine’s energy-intensive industry. First, it signed a 30-year loan agreement of USD 200 million with IBRD and under the state guarantee of Ukraine for the financing of energy-saving projects. Second, under the Energy Efficiency Program of EBRD, Ukreximbank has provided loans in the amount of almost USD 90 million to finance about 50 projects worth over USD 320 million. It also administers the Nordic Investment Bank’s program for modernizing the industry and delivering a positive environmental impact, in the form of a USD 50 million loan facility. On top of these initiatives comes GCPF’s USD 30 mil-lion loan agreement. Ukreximbank has put it at work in the agriculture sector, where it financed energy

efficiency measures, such as the replacement of drip irrigation systems and fertilizers dissolving units, or the installation of heat accumulating water storage tanks.


Ukraine

KEY FIGURES


Loan size (USD) 545,000 Annual CO2 Saving (tons) 1,435

Disbursement Date October 4, 2012 Lifetime CO2 Saving (tons) 1 14,350

BackgroundKaterynivska is an agricultural firm in the Dnipropet-rovsk region with 6.3 ha of greenhouses. Its main end goods are cucumbers, which are produced in greenhouses to accommodate their need for warm, wet and stable atmospheric conditions.

Modernizing the Greenhouse and Implementing Energy Saving Technologies in an Agriculture Firm

Katerynivska employs 105 people. The company constantly develops and modernizes its growing process, introducing new technologies and imple-menting up-to-date equipment.

Project InformationThe company has invested USD 774,750 to mod-ernize its greenhouses and implemented up-to-date energy saving technologies that include:

• the installation of energy efficient C02 supply and distribution systems;

• the replacement of drip irrigation systems and fertiliser dissolving units; and

• the Installation of a heat accumulating water storage tanks.

The installation of energy efficient C02 supply and distribution systems along with a heat accu-mulating water storage tank allows maintaining an optimal balance between heat and humidity. The tailored equipment saves energy in winter, avoids heat leakage at night time and reduces

overheating during extreme solar radiation periods. Automated irrigation and fertiliser supply systems ensure an efficient management of the main para-meters of a nutrient solution. As a result of drip irrigation, water consumption is bound to decrease by 50 %. The investment will reduce the business’s dependence on traditional energy resources.

Overall, the system will:

• reduce natural gas consumption by 510,353 m3 per year;

• reduce energy consumption by 486,000 kWh per year;

• boost productivity by 20 – 40 %. Expected yield – 2400 tons per year;

(1) Assuming a 10 year lifecycle of the production line.






Confirmed by bank on February 8, 2013



None



KEY FIGURES

VietinBank Vietnam


Total equity (USD) 1,360,569,232 GDP at PPP (USD bn) 1 299.99



Net income / Total assets 1.36 %Total CO2 emissions (thousand metric tons) 2 142,258


Source: VietinBank’s 2011 Annual Report. FX conversion rate by the end of 2011 VND / USD: 20.941





Profile of VietinBankVietinBank was established in 1988 after being separated from the State Bank of Vietnam. The bank operates through 149 local branches and 1,123 transaction and saving offices in Vietnam. As one of Vietnam’s largest state-owned commercial bank, VietinBank’s total assets account for over 20 % of the whole Vietnamese banking system. Its capital resources have been on a constant annual rise of

20 % since 1996. In 2011, VietinBank became the very first state commercial bank to have a foreign shareholder, when IFC purchased 10 % of its equity for USD 182 million.

In December 2012, Tokyo Mitsubishi UFJ, Japan’s top lender by assets, purchased a 20 % stake for USD 743 million.

Green lending activitiesVietinBank pioneered into green financing in 2008. From a modest in-house start with a disbursement of USD 14.1 million for EE / RE projects such as heat recovery, the bank has significantly expanded its green financing activities. It has successfully coop-erated with the Global Environment Facility (GEF) to implement 45 energy conservation projects with local SMEs. It has also drawn on a 20-year EUR 100 million loan from the EIB to invest in projects that enhance energy efficiency and curb climate change.

GCPF’s USD 25 million loan catalyzes VietinBank’s strategic development in green lending and allows a full-scale deployment into the SME segment. VietinBank’s efforts are led by a specialized team within the SME department. This team acts as

the liaison for all EE / RE projects within the bank and as the centre of competence for the branch officers. Financing activities mainly revolve around the manufacturing and processing sectors, both large contributors to Vietnam’s energy-intensive industries.


Vietnam

KEY FIGURES


Loan size (USD) 3,100,000 Annual CO2 Saving (tons) 1,227

Disbursement Date November 2, 2012 Lifetime CO2 Saving (tons) 1 12,270

Upgrade of Cattle Foodstuff Production Line

BackgroundFounded in 2003, Greenfeed Viet Nam specializes in the production and trading of foodstuff for cattle, poultry, aquatics and breeding animals. Greenfeed has 5 factories that produce foodstuff. The produc-tion capacity is 1,000,000 ton / year.

The Hung Yen factory had one production line with designed capacity of 150,000 ton / year and actual capacity of 162,000 ton / year. The average energy consumption was 32.6 kWh / ton.

Project InformationIn the Hung Yen factory, the main energy system of the existing production line includes a mixing and a grinding system. The designed capacity of the grinding system is higher than that of the mix-ing system and there is no silo to store the mixed material. As such, the two grinders operate without load sometimes. This leads to energy waste in every grinding batch.

Greenfeed invests in a new production line to improve economic efficiency and reduce CO2 emissions. The new line comprises two lines of

20 ton / hour each, equivalent to 240,000 ton / year. The production capacity is 48 % higher than that of the existing system. In the new line, the grind-ing group comprises 2 grinders with a capacity of 30 ton / hour and operates independently. They don’t depend on the mixing capacity as the mate-rial is grinded independently and stored in silos. This avoids operation without load. The average energy consumption of the new production line is 23.2 kWh / ton, a 29 % reduction compared to the existing production line.

(1) Assuming 10 year lifecycle of the production line.




Confirmed by bank on 21 December 2012


Confirmed by bank on 1 December 2012



None

Social and environmental categorization 3 Category C


KEY FIGURES

XacBank Mongolia

Total assets (USD) 779,460,621 Population (m) 1 2.786




Net income / Total assets 1.41 %Total CO2 emissions (thousand metric tons) 2 14,503


Source: XacBank’s 2012 Unaudited Annual Report. FX conversion rate MNT / USD: 1,392.1





Profile of XacBankXacBank LLC is the fourth largest bank in Mongo-lia with about 9 % market share in both deposits and lending. XacBank’s main markets are micro and SME loans. Other activities include consumer loans, mortgage loans and various other smaller loan portfolios such as leasing or whole sale loans.

XacBank maintains one of the largest branch net-works across rural Mongolia.

XacBank was created as a result of a merger of the two largest non-bank financial institutions in Mon-golia, in late 2001, X.A.C. LLC and Goviin Ekhlel LLC.

Green lending activitiesXacBank’s Eco Banking Department targets resi-dents of the so-called ger districts in and around Ulaanbaatar. Gers are typical Mongolian nomadic tents. Most inhabitants of these impoverished areas either live in such gers or in poorly constructed stand alone houses. XacBank is addressing pollution through support to both consumers and producers of energy efficient products. It was set up in 2010 and started by distributing and selling subsidized energy efficient products, including efficient stoves and highly insulated ger blankets, in partnership with the Ulaanbaatar city government and various donor agencies. In addition, the bank started to provide subsidized eco consumer loans for consumers who adopt energy efficient products. With this program, XacBank has become the only commercial bank in Mongolia to introduce specialized financial products

that support clean technologies to address air pol-lution. In addition to energy efficient products, Xac-Bank recently started to develop plans to integrate ecoloans into its mortgage activities by providing financing to families moving out of the ger districts into more energy efficient homes and apartments.


Mongolia

KEY FIGURES


Loan size (USD) 1 400,000 Annual CO2 Saving in % 30 to 50 %

Disbursement Date 2012

BackgroundXacBank began providing Eco services in 2009 to improve energy efficiency and reduce pollution in Mongolia’s capital city. Ulaanbaatar is both the coldest capital, as well as the most polluted city in the world, especially in winter. The city comprises roughly half of the national population, with its 1.2 million residents. This population has continu-ously increased, rising by 70 % in the last 20 years. 60 % of the population lives in the capital, com-prising 177,000 families, and most new migrants to Ulaanbaatar live in the gers.

Approximately 60 % of the pollution (up to 70 % in the ger districts) is due to inefficient heating systems. Levels of particulate pollution during winter months are fourteen times higher than the WHO’s standards. Pollution-related health costs are estimated at USD 463 million per year, namely 18.8 % of Ulaanbaatar’s GDP, according to 2011 World Bank’s estimates.

Project InformationTraditional stoves used in households throughout the ger districts are small and inefficient, resulting in high fuel use and particulate matter emissions. Energy-efficient stoves sold or in development in Mongolia reduce particulate matter emissions by at least 80 % and reduce fuel consumption by 30 – 50 %, resulting in the same percentage of CO2 emissions’ reduction. The Millennium Challenge Account (MCA) Energy and Environment Program

has provided so far end-user subsidies for two im por ted stove models. XacBank operates the sale and distribution centres throughout the city and, by the end of 2012, estimated purchases of 85,000 stoves should have been reached. XacBank intends to commit USD 400,000 to four local stove producers in order to build the capacities of local energy efficient stove producers, as the MCA programs expires in 2013.

(1) Spread over an expected number of four borrowers

Local production of energy efficient stoves


KEY FIGURES

Photovoltaic Project South Africa

Loan size (USD) 2,830,000 Population (m) 2 49.464

Project size 1 MW GDP at PPP (USD bn) 2 50.59

Expected energy production (kWh / p.a)

1,854,000 GDP at PPP per capita (USD) 2 10,970.31

Avoided CO2 emissions (t / p.a) 1 1,703 GDP at PPP growth 2011 2 1.20 %

Total CO2 emissions (thousand metric tons) 3 499,016

CO2 emissions per capita (metric tons) 3

10.05

Sources: 1) Baseline: International

Energy Agency, 2011: carbon intensity of electricity sector in South Africa: 925 g CO2

/ kWh2) International Monetary


3) Millennium Develop-ment Goal Indicators 2012, United Nations Statistics Division

Project ProfileThe Global Climate Partnership Fund (GCPF) has financed a 1 MW photovoltaic power plant in South Africa, which represents the Fund’s first direct investment into a renewable energy production facility.

The photovoltaic installation was initiated by CRONIMET Mining Energy AG, a system provider of energy solutions for mining companies and a member of the German CRONIMET Mining Group. In 2008, CRONIMET Mining Group started

development of today’s CRONIMET Chrome Thaba Mine located in the Limpopo region, South Africa, and has thus achieved a reliable future supply source for chrome products. The photovoltaic park will supply the chrome mining and processing oper-ations of CRONIMET Chrome Mining SA (Pty) Ltd.

Key hardware components are the solar modules and inverters while for this project polycrystalline solar modules were sourced from Jinko Solar and inverters were delivered by SMA.



Compliance with GCPF’s social and environmental exclusion list Confirmed by an external auditor in August 2012; ongoing monitoring

Maintenance of a social and en vironmental management system Full implementation of a SEMS is under way and will be supported by an external consultant



Pursuance of a corrective action plan Yes

Project HighlightsThe project is a captive photovoltaic power plant replacing diesel fuelled generators for the operation of CRONIMET Mining group’s chrome mine.

South Africa is faced with a situation in which the demand for electricity continues to grow much faster than the addition of new generation capac-ity. The country, which is heavily dependent on electricity production from coal, is now diversifying its electricity production by a sustainable green energy initiative which supports a wide range of clean-energy options. The lack of sufficient energy

is already causing limitations in the growth poten-tial of the South African economy.

This project in particular is a great success as it does not rely on any financial support by the public sector in form of feed-in tariffs or subsidies. Its rational is rather based on the rising price for energy and the need for a reliable and independent energy supply. Energy production will be monitored and reported by GCPF over the lifetime of the invest-ment.

(1) Rating scale comprises categories A (high risk), B (medium risk) and C (low risk)

South Africa


Investment Portfolio

GCPF’s investment portfolio grew by USD 102.8 million in 2012 to reach a total of USD 152.8 million by year end. It diversified significantly across geogra-phies and is now present in 7 countries and 4 continents. The share of subor-dinated debt was significantly reduced, since all new additions were senior debt loans.

The fund’s portfolio entirely consists of USD investments and therefore bears no direct currency risks. The first direct investment was undertaken, represen ting a share of 1.85 % of the total portfolio. A growing share of direct investments will further improve the risk diversification of the overall portfolio.

Total USD 152.83 m

Şekerbank 25 m

Vietinbank 25 m

Banco Pichincha 15 m

Banco ProCredit 10 m

Ukreximbank 30 m

Banco Pine 30 m

XacBank 15 m

Cronimet 2.83 m

Disbursed investmenty by Partner Institution

Turkey 25 m

Vietnam 25 m

Ecuador 25 mUkraine

30 m

Brazil 30 m

Mongolia 15 m

South Africa 2.83 m

Disbursed investments by Country

Total USD 152.83 m


USD 100 %

Disbursed investments by currency

Senior debt 90.19 %

Subordinated debt 9.81 %

Disbursed investments by financial instrument

Direct Investment 1.85 %

Financial Institution 98.15 %

Disbursed investments by type of Partner Institution


$ 51,289Average size of loans disbursed by GCPF’s partner institutions in 2012

32 | | | | 2012 Activities Report: Funding

2012 Activities Report: Funding

Throughout the year, GCPF drew shares from existing commitments worth USD 43 million and issued notes worth USD 30 million to finance its new investments. The notes came from a private insti-tutional investor, ÄrzteVersorgung Westfalen-Lippe, representing a significant jump in the private sector capital the fund has tapped so far.

2012 Activities Report: Funding | | | | 33

Funding Situation

Shareholder structure based on voting rights

Current split of investments committed to GCPF

German Federal Ministry for the Environment, Nature Conservation and Nuclear Safety 17.91 %

Ministry of Foreign Affairs Denmark3.29 %

International Finance Corporation32.12 %

KfW Entwicklungsbank32.12 %

Deutsche Bank1.71 %

Private sector investor12.85 %

International Finance Corporation 20.97 %

KfW Entwicklungsbank 12.04 %

Deutsche Bank 9.32 %

Ministry of Foreign Affairs Denmark 8.95 %


Shareholder structure based on invested capital

International Finance Corporation 37.65 %

KfW Entwicklungsbank 19.03 %Deutsche Bank

3.24 %

Ministry of Foreign Affairs Denmark 6.22 %



In 2012, GCPF issued notes for the first time in its history. Notes are designed for private investors. They are senior to all share investors and bear no voting rights.

While GCPF already invested all of its current Class C Share commitments, it still has significant com-mitments for Class B and C Share which serve as a liquidity cushion for future investments. Going forward, GCPF aims to bring new Class C Share investors on board and to increase its share of private investors.

GCPF funds itself across three different share classes: Class C Shares which represent the fund’s equity, Class B Shares which rank senior to the equity portion and Class A Shares which rank senior to the other two share classes but junior to all other creditors of the fund. All these share classes bear voting rights. While Class C Share are essentially designed to correspond to the expectations of governments or donors, the other two share classes are of more commercial nature and are currently held by development banks and the investment manager.

Current split of shareclasses according to NAV and remaining commitments

Invested capital

Remaining commitments

67

53

A-Shares

7

27

B-Shares

49

C-Shares

30

Notes

Figures in million USD


Leveraging Private Investors’ Resources

Private investments are key to mitigate climate change

Annual investments ranging from EUR 490 billion by 2020 to EUR 860 billion by 2030 are required on top of a business as usual scenario to capture the full abatement potential and mitigate global greenhouse gas emissions1.

Due to the limitations of public households high-lighted through the various public debt crises, the still existing large gap needs to be bridged by mobilizing private investors globally. In 2012, private actors have contributed USD 85 bn to climate finance in developing countries. These were dominated by local actors with a share of 83%2. This sum still falls far short of the realistic tech nical opportunities identified3. Difficulties, such as higher financial costs due to the riskier business environment, or regulatory uncertainties often limit the involvement of the private sector. Direct and targeted public finance can be used to leverage private investments by changing the risk profile currently experienced by private inves-tors. It can foster liquidity and transparency and help shape the risk-return adjusted investments

demanded by investors over an appropriate time-frame.

In order to leverage public sector capital, the GCPF has several layers. First, project financings and loans granted by the fund’s local partner institu-tions generally include an equity portion asked for to ensure aligned interests by the borrowers and the fund or the local banks as lenders. Second, in case of on-lending, banks may also finance projects only partially with the support of GCPF. As a third layer, the GCPF has a tiered risk / return structure, which would typically allocate public financing into the equity position while private sector investors typically take senior ranking positions and in the long run are expected to create the mass of the funding available to GCPF. As such the structure allows private investors to benefit from a diversi-fied portfolio and the protection of subordinated tranches held by public investors. Further informa-tion is provided in the section “Presentation of the Global Climate Partnership Fund” or on the Fund’s website www.gcpf.lu

1) McKinsey, Version 2.1 of the global greenhouse

gas abatement cost curve, p. 10, 2010

2) Climate Policy Initiative, The landscape of

climate finance 2012, p. 6, 2012

3) McKinsey, Version 2.1 of the global greenhouse

gas abatement cost curve, p. 10, 2010


Investor’s Profile: ÄrzteVersorgung Westfalen-Lippe

Pension fund demonstrates commitment to public-private partnership in climate finance

Ärzteversorgung Westfalen-Lippe (“ÄVWL”), one of the largest branch-specific German pension funds with approximately 50,000 members and pensioners and an asset base around € 10 billion, has become the first private investor in the GCPF in 2012. In December 2012, it signed notes worth USD 30 million highlighting ÄVWL’s com-mitment to the promotion of energy efficiency and clean energy sources in emerging countries.

ÄVWL views sustainable development as a core objective in the fulfillment of its mandate to successfully manage its members’ resources ahead or during their retirement period. Through its involvement in the GCPF it shows that the use of public funds to leverage private investments in climate finance can create both economic and environmental value for investors.


$ 200,000Total volume of technical assistance projects approved

38 | | | | Social & Environmental Report

Social and Environmental Report

GCPF aims to conduct its operations in line with the highest expectations regarding social and environmental responsibility. It therefore communicates to its stake-holders on an annual basis the status of its Social and Environmental Management System, which includes the assessment of its partner institutions, and the achieved greenhouse gas emission savings.

The Fund also benefits from a technical assistance facility which supports its mission and strategic direction, primarily to assist partner institutions in their develop-ment and their growth as well as to prepare and protect investments, if necessary.

Social & Environmental Report | | | | 39

GCPF seeks to maintain the highest recognized standards for the management of social and envi-ronmental risks in its operations. Therefore, the Social and Environmental Management System (SEMS) was developed in close cooperation with the International Finance Corporation and KfW Development Bank over the spring / summer 2012. It was officially approved by the Board of Directors during the board meeting of September 12, 2012.

For both investments into financial institutions and into projects, the SEMS outlines the specific performance requirements which the Fund has vis-à-vis its partner institutions. It also details how compliance with these is assessed during the due diligence process and monitored later on. In case of discrepancies between the observed status quo and the performance requirements, the SEMS out-

lines corrective action measures to be taken and defines standards on the social and environmental reporting to the Fund’s stakeholders. For all its investments, the Fund shall, where applicable, reflect the following dimensions in its screening:

1. Human Rights

2. Labour Standards

3. Environment and Impact on Communities

4. Corruption

For an overview of the current social and environ-mental assessment of GCPF’s partner institutions, please refer to the section “2012 activities report: investments”.

$ 233,568,000Amount committed by investors for GCPF

Social and Environmental Management System


The disbursement of sub loans picked up signifi-cantly in 2012. While the business plans of the fund’s partner institutions are very diverse and therefore include a wide field of different project types, GCPF is currently working on the develop-

ment of a comprehensive and standardized carbon counting framework. This approach should help to increase transparency and ease comparisons between different investment approaches, supporting the efficient allocation of capital for climate change mitigation.

Energy and Greenhouse Gas Savings 2012

ENERGY AND GREENHOUSE GAS SAVINGS

Number of Sub Loans

Total Sub Loan Volume (USD)

Average Sub Loan Size (USD)

Agriculture 175 11,750,814 67,148

Buildings 423 13,328,087 31,508

Other 14 7,240,500 517,179

Renewables 1 7,000 7,000

Transportation 23 715,950 31,128

Grand Total 636 33,042,351 51,953

Special notice: Restatement of carbon impact figuresThe GCPF carbon impact figures have been restated as of Q2 2015, due to errors in the estimation of carbon reduction of two projects that have a substantial impact on overall Fund figures. Therefore, relevant figures in this report have been re-stated – or deleted where recalculation was not feasible - to ensure accuracy and consistency across all reports. It is clearly indicated wherever figures have been restated, and all other information in the report remains unchanged.For corrected carbon impact figures for 2012, see the Q4 2012 Quarterly Report, available at www.gcpf.lu.

The impact of these two projects on average % CO2 savings of sub-loans is negligible, as this indicator is calculated using a simple average of all sub-loans. Therefore, the figures for this indicator have not been restated.


$ 152,800,000Total volume of loans disbursed since the Fund’s inception in USD

Summary of the Technical Assistance Facility activities

Purpose

The Global Climate Partnership Fund is supple-mented by a technical assistance facility (TA Facility) providing hands-on and tailored services to the inves-tees of the Fund. The facility has been designed as a responsive and adaptable scheme, in order to:

• Conduct market-enabling technical, economic and business reviews

• Build capacities by helping along partner institutions initiate and scale-up green lending products

• Raise awareness for energy efficiency and renewable energy projects

• Monitor the social and environmental impact of the investments

The services delivered by the TA Facility are there-fore to be seen complementary to the Fund’s objec-tives. The TA Facility shall enable local partners of the Fund to develop green lending / renewable energy activities and thus is additional to the tasks of the Investment Manager that are more related to the origination, execution and administration of ongoing investments.

Activities

The GCPF ramped up its technical assistance activities in 2012, in line with the growth of its investments. Its technical assistance services spanned from country assessments to business development and technical feasibility studies both for investments into financial institutions and for direct investments.

In 2012, GCPF embarked on three technical assis-tance projects and is currently negotiating a fourth project.

First, it commissioned a country study focused on the Philippines. Its aim is to identify the need and demand for investments in renewable energy and energy efficiency products in the Philippines. It includes the assessment of existing markets, technical products and regions where economically viable investments exist, the analysis of currently available financing options, and the identification of relevant energy service companies (“ESCOs”).


$ 152,800,000

Furthermore, the GCPF launched two direct invest-ment studies. The first consists of the technical review of an 8.3MW hydro power plant located in Indonesia. Not only will the technical advisor deal with the engineering design and topographic aspects of the projects, but it will also assess the bankability and financial structure of the undertaking.

The second is a feasibility study for a waste-to-energy facility in China. The technical assistance project covers the analysis of the waste supply chain, a proposal for the design of the facility and produces economic and financial forecasts.

Outlook

The technical assistance facility will continue to work with financial institutions and prepare or accompany direct investments in 2013. A main focus will lay on the capacity development of smaller financial institutions and on the develop-ment of innovative concepts for energy-efficiency projects.


95 % Growth of Fund’s Assets in 2012

44 | | | | Financial Statements

In 2012, GCPF went fully profitable and is able to pay out its target dividends as well as complimentary dividends to entitled investors. In relation to growth, the cost basis went down, allowing the fund to benefit of its growing portfolio in this respect. The presented figures are the unaudited financial state-ments as of December 31, 2012. For a full version of the official and audited financial statements, please contact the fund (see last page).

Financial Statements

Financial Statements | | | | 45

Balance Sheet

STATEMENT OF FINANCIAL POSITIONAS AT 31 DECEMBER 2012(EXPRESSED IN USD)

31 December 2012 31 December 2011

ASSETS

Non-current assets

Loans and advances to partner institutions 152,830,000.00 50,000,000.00

Total non-current asset 152,830,000.00 50,000,000.00

Current assets

Interest receivable 9,913.35 14,734.04

Other receivables and repayments 10,938.68 168,575.17

Cash and cash equivalents 4,282,094.82 30,445,019.08

Total current assets 4,302,946.85 30,628,328.29

Total Assets 157,132,946.85 80,628,328.29

LIABILITIES

Current liabilities

Other payables and accrued expenses 3,655,773.44 540,742.70

Interest-bearing loans and borrowings 30,000,000.00 –

Total current liabilities 33,655,773.44 540,742.70

Total liabilities (excluding net assets attributable to holders of redeemable shares)

33,655,773.44 540,742.70

Net assets attributable to holders of redeemable ordinary shares

74,000,000.00 31,000,000.00

Class A Shares 67,000,000.00 28,000,000.00

Profit/(loss) for the year – –

Class B Shares 7,000,000.00 3,000,000.00

Profit/(loss) for the year – –

EQUITY

Share capital 49,491,625.00 49,491,625.00

Loss brought forward (404,039.41) 412,275.58

Profit for the year 389,587.82 (8,236.17)

Total equity 49,477,173.41 49,087,585.59

Total liabilities and equity 157,132,946.85 80,628,328.29


Income Statement

STATEMENT OF COMPREHENSIVE INCOMEFor the year ended 31 December 2012(Expressed in USD)

For the year ended 31 December 2012

For the year ended 31 December 2011

INCOME

Interest revenue 4,142,265.29 508,557.42

Other income 1,004,300.00 464,000.00

Net foreign exchange gains 11,738.23 15,535.88

Total Income 5,158,303.52 988,093.30

EXPENSES

Fund management fees (1,623,239.00) (200,000.00)

Direct operating expenses (894,834.39) (779,402.80)

Other operating expenses (236,730.73) (454.33)

Net foreign exchange losses (10,215.07) –

Total Expenses (2,765,019.19) (979,857.13)

Total operating profit before taxes 2,393,284.33 8,236.17

Withholding taxes (182,939.51) –

Distribution to holders of redeemable ordinary shares (1,820,757.00) –

Profit for the year 389,587.82 8,236.17

Other comprehensive income for the year (net of tax) – –

Total comprehensive income for the year (net of tax)

389,587.82 8,236.17

Disclaimer: The presented figures constitute the unaudited financial statements as of December 31, 2012. Changes occurring during the audit process are possible. For a transcript of the finalized and audited financial statements, please contact the Fund directly.


Statement of Changes in net assets

CLASS A SHARES CLASS B SHARES CLASS C SHARES

Net assets attributable to shareholders Number of shares Net assets attributable

to shareholders Number of shares Net assets attributable to shareholders Number of shares Combined net assets

attributable to shareholder

At 31 December 2011 28,000,000.00 186.66 3,000,000.00 120.00 49,087,585.59 989.83 80,087,585.59

Issue of redeemable ordinary shares

39,000,000.00 259.96 4,000,000.00 160.00 – – 43,000,000.00

Redemption of redeemable ordinary shares

– – – – – – –

Issue of equity – – – – – – –

Redemption of equity – – – – – – –

As at 31 December 2012 67,000,000.00 446.62 7,000,000.00 280.00 49,087,585.59 989.83 123,087,585.59

Increase in net assets attributable to holders of redeemable oridnary shares from transactions in shares

– – – – – – –

Decrease in net assets attributable to holders of redeemable ordinary shares from transactions in share

– – – – – – –

Operating gain before tax and distribution for the year

1,531,449.26 – 289,307.74 – 389,587.82 – 2,210,344.82

Distribution to holders of Class A and Class B shares

(1,531,449.26) (289,307.74) (1,820,757.00)

As of 31 December 2012 67,000,000.00 446.62 7,000,000.00 280.00 49,477,173.41 989.83 123,477,173.41

STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO HOLDERS OF REDEEMABLE ORDINARY SHARES AND EQUITYFOR THE YEAR ENDED 31 DECEMBER 2012(EXPRESSED IN USD)


CLASS A SHARES CLASS B SHARES CLASS C SHARES

Net assets attributable to shareholders Number of shares Net assets attributable

to shareholders Number of shares Net assets attributable to shareholders Number of shares Combined net assets

attributable to shareholder

At 31 December 2011 28,000,000.00 186.66 3,000,000.00 120.00 49,087,585.59 989.83 80,087,585.59

Issue of redeemable ordinary shares

39,000,000.00 259.96 4,000,000.00 160.00 – – 43,000,000.00

Redemption of redeemable ordinary shares

– – – – – – –

Issue of equity – – – – – – –

Redemption of equity – – – – – – –

As at 31 December 2012 67,000,000.00 446.62 7,000,000.00 280.00 49,087,585.59 989.83 123,087,585.59

Increase in net assets attributable to holders of redeemable oridnary shares from transactions in shares

– – – – – – –

Decrease in net assets attributable to holders of redeemable ordinary shares from transactions in share

– – – – – – –

Operating gain before tax and distribution for the year

1,531,449.26 – 289,307.74 – 389,587.82 – 2,210,344.82

Distribution to holders of Class A and Class B shares

(1,531,449.26) (289,307.74) (1,820,757.00)

As of 31 December 2012 67,000,000.00 446.62 7,000,000.00 280.00 49,477,173.41 989.83 123,477,173.41

STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO HOLDERS OF REDEEMABLE ORDINARY SHARES AND EQUITYFOR THE YEAR ENDED 31 DECEMBER 2012(EXPRESSED IN USD)


Cash Flow Statement

STATEMENT OF CASH FLOWSFOR THE YEAR ENDED 31 DECEMBER 2012(EXPRESSED IN USD)

For the year ended 2012 For the year ended 2011

Cash flows from operating activities

Operating profit before tax 389,587.82 8,236.17

Non-cash adjustment to reconcile profit before net cashflows

Interest income, net of withholding tax (3,959,325.78) (508,557.42)

Change in working capital:

Decrease / (increase) in trade and other receivables and prepayments

157,636.49 (168,575.17)

Increase in trade and other payables 3,016,625.86 308,794.40

(395,475.61) (360,102.02)

Interest paid (18,825.00) –

Interest received 4,081,376.35 493,823.38

Net cash flows from operating activities 3,667,075.74 133,721.36

Cash flows from investing activities

Net (increase) in loans to Partner Institutions (102,830,000.00) (50,000,000.00)

Net cash flows used in investing activities (102,830,000.00) (50,000,000.00)

Cash flows from financing activities

Cash received on Shares issued 43,000,000.00 38,675,685.00

Proceeds from borrowings 30,000,000.00 –

Net cash flows from financing activities

73,000,000.00 38,675,685.00

Net (decrease) / increase in cash and cash equivalents (26,162,924.26) (11,190,593.64)

Cash and cash equivalents at 1 January 30,445,019.08 41,635,612.72

Closing cash and cash equivalents at 31 December 4,282,094.82 30,445,019.08


Imprint

Contact informationwww.gcpf.lu [email protected]

Publisher: Global Climate Partnership Fund, SA SICAV-SIF 14, Boulevard Royal, L-2449 Luxembourg

DisclaimerThe Fund is an investment company with variable capital

governed by the laws of the Grand Duchy of Luxembourg and

is subject to the Law of 13 February 2007 on specialized invest-

ment funds, as amended or supplemented from time to time.

The Fund is reserved to certain Eligible Investors as defined in

the Issue Document.

The information given in this report constitutes neither an offer

nor a product recommendation; it is provided for individual

information purposes only. No guarantee is given or intended as

to the completeness, timeliness or accuracy of the information

provided herein. This report is neither an issue document as

specified by law, nor the annual report of the Fund nor the

management report. The current Issue Document is obtainable

at the registered office of the Fund. Please request the Fund’s

Issue Document and read it carefully and seek advice from your

legal and / or fiscal advisor before investing.

The distribution of the Issue Document and the offering of the

Shares and Notes may be restricted in certain jurisdictions. The

Issue Document does not constitute an offer or solicitation in

a jurisdiction where to do so is unlawful or where the person

making the offer or solicitation is not qualified to do so or where

a person receiving the offer or solicitation may not lawfully do

so. It is the responsibility of any person in possession of the

Issue Document and of any person wishing to apply for Shares

or Notes to inform themselves of and to observe all applicable

laws and regulations of relevant jurisdictions. Distribution of

the Issue Document by an unauthorised person is forbidden

and shall be solely at his own risk. Investors should inform

themselves and should take appropriate advice as to possible

tax consequences, foreign exchange restrictions or exchange

control requirements which they might encounter under the

laws of the countries of their citizenship, residence, domicile

or other eligible laws and which might be relevant to the sub-

scription, purchase, holding, redemption or disposal of the

Shares or the Notes of the Fund.

The Shares and Notes of the Fund have not been and will not

be registered under the United States Securities Act of 1933 as

amended from time to time (the „1933Act“) or the securities

laws of any of the states of the United States, for offer or sale,

directly or indirectly in the United States of America, except

pursuant to an exemption from the registration requirements

of the 1933 Act as part of their distribution and the Fund has

not been and will not be registered under the United States

Investment Company Act of 1940.2012 GLOBAL CLIMATE

PARTNERSHIP FUND.

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