The World Bank Implementation Status & Results Report BiH Firm Recovery and Support Project (P174604) BiH Firm Recovery and Support Project (P174604) EUROPE AND CENTRAL ASIA | Bosnia and Herzegovina | Finance, Competitiveness and Innovation Global Practice | IBRD/IDA | Investment Project Financing | FY 2021 | Seq No: 4 | ARCHIVED on 13-Oct-2022 | ISR52513 | Implementing Agencies: Bosnia and Herzegovina, Federation BiH Development Bank, RS Investment Development Bank Key Dates Key Project Dates Bank Approval Date: 11-Dec-2020 Effectiveness Date: 20-Sep-2021 Planned Mid Term Review Date: 03-Oct-2022 Actual Mid-Term Review Date: 23-Sep-2022 Original Closing Date: 31-Dec-2024 Revised Closing Date: 31-Dec-2024 pdoTable Project Development Objectives Project Development Objective (from Project Appraisal Document) The Project Development Objective is to support the recovery of micro, small and medium enterprises (MSMEs) affected by COVID-19 through improved access to long term financing and to refocus government programs to support MSMEs’ resilience in the aftermath of COVID-19. Has the Project Development Objective been changed since Board Approval of the Project Objective? No Components Table Name Line of Credit:(Cost $59.60 M) Strengthen the institutional and policy framework in support of firm recovery and growth:(Cost $5.10 M) Project Management:(Cost $0.60 M) Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO Satisfactory Moderately Satisfactory Overall Implementation Progress (IP) Satisfactory Moderately Satisfactory Overall Risk Rating Moderate Moderate Implementation Status and Key Decisions Following discussions with the government authorities and the development banks, it was agreed that the WB project team will work with PIUs to address immediate bottlenecks impeding faster project implementation. A number of steps were identified during the mission to facilitate faster implementation. The Bank team will monitor progress against objectives during the last quarter of 2022 calendar year. Depending on the progress of project implementation with the modifications, the WB team will discuss with the ministries of finance and the PIUs suggested improvements and next steps by end December 2022. Reporting. The reporting is timely and contains appropriate information. The reporting template will be updated going forward, to include a section on Grievance Mechanism. 10/13/2022 Page 1 of 8 The World Bank Implementation Status & Results Report BiH Firm Recovery and Support Project (P174604) Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance Substantial Substantial Substantial Macroeconomic Substantial Substantial Substantial Sector Strategies and Policies Moderate Moderate Moderate Technical Design of Project or Program Moderate Moderate Moderate Institutional Capacity for Implementation and Moderate Moderate Moderate Sustainability Fiduciary Moderate Moderate Moderate Environment and Social Moderate Moderate Moderate Stakeholders Low Low Low Other -- -- -- Overall Moderate Moderate Moderate Results PDO Indicators by Objectives / Outcomes Support MSMEs access to finance and consolidated firm-targeting public support programs IN01173808 ►Ratio of weighted average change in operating results [Value Added] of the MSMEs financed under the Project, over the average change of operating results [Value Added] in their respective sector (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 1.00 Too early to measure Too early to measure >1 Date 30-Sep-2020 11-Mar-2022 23-Sep-2022 31-Dec-2024 Operating Results Multiplier: Ratio of weighted average change in operating results [Value Added] of the firms financed under the Project, over the average change of operating results [Value Added] in their Comments: respective sector. Value Added is defined as Total Operating Profit + Total Wages. This will measure whether firms supported under the Project show better results than their peers. Indicator will be weighted by firm size. IN01173809 a) for all MSMEs financed under the project (Text, Custom Breakdown) Baseline Actual (Previous) Actual (Current) End Target Value 1.00 Too early to measure Too early to measure >1 Date 30-Sep-2020 11-Mar-2022 23-Sep-2022 31-Dec-2024 10/13/2022 Page 2 of 8 The World Bank Implementation Status & Results Report BiH Firm Recovery and Support Project (P174604) IN01173810 b) for all micro and small enterprises financed under the project (Text, Custom Breakdown) Baseline Actual (Previous) Actual (Current) End Target Value 1.00 Too early to measure Too early to measure >1 Date 30-Sep-2020 11-Mar-2022 23-Sep-2022 31-Dec-2024 IN01173881 ►Number of MSMEs that have implemented measures to adapt to COVID-19 environment with support of govt programs (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 140.00 303.00 50.00 Date 14-Jul-2020 11-Mar-2022 23-Sep-2022 31-Dec-2024 Regular report from the two entity ministries on the progress towards refocusing of programs supporting tech and digital adoption. Measures of adaptation are related to adoption of digital/tech solutions that mitigate restrictions imposed by the pandemic such as related to adoption of digital/tech solutions that Comments: mitigate restrictions imposed by the pandemic such as e-commerce, cloud-based solutions, remote work solutions, automation, new procedures or processing methods leading to improving production and/or processing of higher quality, increasing/adapting standards to achieve better physical and functional standards of operation. Intermediate Results Indicators by Components Component 1 - Line of credit IN01173882 ►Number of firms financed under the Project (cumulative) (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 240.00 Date 30-Sep-2020 11-Mar-2022 23-Sep-2022 31-Dec-2024 Comments: Number of firms financed under the Project (cumulative) IN01173884 ►Volume of credit line disbursed under the Project (cumulative, EUR million) (Number) (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 51.00 Date 30-Sep-2020 11-Mar-2022 23-Sep-2022 31-Dec-2024 Comments: Volume of credit line disbursed under the Project (cumulative, EUR million) IN01173886 ►Number of firms financed in vulnerable segments (women inclusive, young firms and lagging regions) through PFIs (cumulative) (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target 10/13/2022 Page 3 of 8 The World Bank Implementation Status & Results Report BiH Firm Recovery and Support Project (P174604) Value 0.00 0.00 0.00 60.00 Date 30-Sep-2020 11-Mar-2022 23-Sep-2022 31-Dec-2024 Number of firms financed in vulnerable segments under the Project (cumulative). Vulnerable segments Comments: includes women -inclusive enterprises, young enterprises, and enterprises in lagging regions as defined in Project documents. IN01173887 ►Number of women-inclusive firms financed through PFIs (cumulative) (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 30.00 Date 30-Sep-2020 11-Mar-2022 23-Sep-2022 31-Dec-2024 Women-inclusive Enterprises are defined as: (i) more than 50% owned by women (i.e., with at least one female shareholder with a properly documented representative and managing powers); or (ii) managed by women (i.e., with at least one female C-level manager or with at least 25 percent female representation in Comments: mid-level management); or (iii) employing a ratio of women that is higher than the average ratio observed in the respective sector; or (iv) has increased the share of women employment by at least 5 percent in the previous year. IN01173888 ►Number of jobs preserved/created by MSMEs (women-inclusive MSMEs) (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 0.00 Date 30-Sep-2020 11-Mar-2022 23-Sep-2022 31-Dec-2024 Comments: Number of jobs preserved/created by MSMEs and disaggregated for women-inclusive MSMEs IN01173889 ►Portfolio Quality: Portfolio at risk (%) (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 7.00 Date 30-Sep-2020 11-Mar-2022 23-Sep-2022 31-Dec-2024 The indicator is not MSME specific and follows the local definition for NPLs, as regulated by the Banking Agencies. The indicator will report by PFI, both the entire portfolio and the Bank-financed portion. The Comments: quality of sub-loan portfolio is likely to be lower than normally expected in the Bank’s FI projects, given the very negative economic outlook and the credit line’s focus on adversely impacted companies. IN01173890 ►Financial Sustainability: Return on Assets (%) (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 1.20 0.00 0.00 0.00 Date 31-Mar-2020 11-Mar-2022 23-Sep-2022 31-Dec-2024 The indicator will report by PFI. Analytical indicators, such as the performance of PFIs and their financing, Comments: will be monitored for analytical purposes and aim to help improve related policies and projects. Therefore no target values are set. 10/13/2022 Page 4 of 8 The World Bank Implementation Status & Results Report BiH Firm Recovery and Support Project (P174604) IN01173891 ►Financial Sustainability: Return on Equity (%) (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 9.60 0.00 0.00 0.00 Date 31-Mar-2020 11-Mar-2022 23-Sep-2022 31-Dec-2024 The indicator will report by PFI. Analytical indicators, such as the performance of PFIs and their financing, Comments: will be monitored for analytical purposes and aim to help improve related policies and projects. Therefore no target values are set. IN01173892 ►Citizen engagement: Share of beneficiaries that report that the project has established effective engagement processes. (Percentage) (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 80.00 Date 30-Sep-2020 11-Mar-2022 23-Sep-2022 31-Dec-2024 Share of beneficiaries that report through new and existing feed-back instruments that the project has Comments: established effective engagement processes. IN01173893 ►Citizen engagement: Firms that report Project sub-finance reflected their needs (%) (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 90.00 Date 30-Sep-2020 11-Mar-2022 23-Sep-2022 31-Dec-2024 A mid-term beneficiary feedback survey will measure the satisfaction of the sub-beneficiary (MSMEs) with Comments: the sub-finance in term of their needs (e.g. longer term working capital and investment finance). Component 2 - Strengthen the institutional and program f/work in support of firm recovery & growth IN01173883 ►Monitoring and evaluation mechanism established (Text, Custom, PBC) Baseline Actual (Previous) Actual (Current) End Target Draft M&E documents prepared for Value No Too early to measure Yes discussion and implementation Date 14-Jul-2020 11-Mar-2022 23-Sep-2022 28-Jun-2024 Support for development of appropriate M&E mechanisms would include systemic reporting and collection Comments: of data on specific input and output indicators related to the implementation of the innovation and entrepreneureship (I&E) support programs. IN01173885 ►New annual action plan/firm incentive program adopted including programs promoting technology and digital adoption (Text, Custom, PBC) Baseline Actual (Previous) Actual (Current) End Target Yes. annual target for Yes. annual target for Value No calendar 2022 has Yes calendar 2021 has been been reached - and 10/13/2022 Page 5 of 8 The World Bank Implementation Status & Results Report BiH Firm Recovery and Support Project (P174604) reached - and annual annual budget budget allocated. allocated. Date 14-Jul-2020 08-Sep-2021 23-Sep-2022 28-Jun-2024 Comments: Annual target for both ministries, linked to the budget allocation for financing of these programs Performance-Based Conditions IN01173894 ►PBC 1 New annual action plan/firm incentive program adopted including programs promoting technology and digital adoption (Text, Outcome, 1,108,945.00, 0.00%) Baseline Actual (Previous) Actual (Current) December 2022 Yes. annual target for calendar 2022 has been Value No Yes. -- reached - and annual budget allocated. Date -- 08-Sep-2021 23-Sep-2022 -- IN01173895 ►PBC 2 New annual action plan/firm incentive program adopted including programs promoting technology and digital adoption (Text, Outcome, 1,400,773.00, 0.00%) Baseline Actual (Previous) Actual (Current) December 2022 Yes. annual target for calendar 2022 has been Value No Yes. -- reached - and annual budget allocated. Date -- 08-Sep-2021 23-Sep-2022 -- IN01173896 ►PBC 3 Monitoring and evaluation mechanism established (Text, Outcome, 945,522.00, 0.00%) Baseline Actual (Previous) Actual (Current) December 2022 Draft M&E documents Value No Too early to measure prepared for discussion -- and implementation Date -- 11-Mar-2022 23-Sep-2022 -- IN01173897 10/13/2022 Page 6 of 8 The World Bank Implementation Status & Results Report BiH Firm Recovery and Support Project (P174604) ►PBC 4 Monitoring and evaluation mechanism established (Text, Outcome, 1,634,235.00, 0.00%) Baseline Actual (Previous) Actual (Current) December 2022 Draft M&E documents Value No Too early to measure prepared for discussion -- and implementation Date -- 11-Mar-2022 23-Sep-2022 -- Data on Financial Performance Disbursements (by loan) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P174604 IBRD-91830 Effective USD 65.30 65.30 0.00 6.75 58.20 10% Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P174604 IBRD-91830 Effective 11-Dec-2020 08-Feb-2021 20-Sep-2021 31-Dec-2024 31-Dec-2024 Cumulative Disbursements 10/13/2022 Page 7 of 8 The World Bank Implementation Status & Results Report BiH Firm Recovery and Support Project (P174604) Restructuring History There has been no restructuring to date. Related Project(s) There are no related projects. 10/13/2022 Page 8 of 8