OFFICIAL
DOCUMENTS
Administration Agreement between the European Commission and the Intern
Reconstruction and Development concerning the Part II Europe 2020 Prog  a 'Sing
Donor Trust Fund                         Uef CZura l
Trust Fund (No TFO72640)                     r ice
(EC Contract No SRSS/S2016/011)                   nefa
This Administration Agreement is concluded under Direct Management in the context of the
Framework Agreement between the World Bank Group and the European Commission dated April 15,
2016 (the Framework Agreement), which sets the general conditions for this Agreement. The
Framework Agreement shall be applicable and form an integral part of the Administration Agreement
for the Trust Fund.
1.    The International Bank for Reconstruction and Development (the "Bank") acknowledges that
the European Commission (the "Donor", and together with the Bank, the "Parties" and each a "Party")
agrees to provide the sum of one hundred thousand Euros (C100,000) (the "Contribution") for the Part
II Europe 2020 Programmatic Single Donor Trust Fund, No. TF072640 (the "Trust Fund") in
accordance with the terms of this Administration Agreement.
The estimated total budget of the Trust Fund is Euro one hundred thousand Euros (100,000). The
indicative budget set out in Annex 5 shall be used for monitoring purpose only and shall not be
binding.
2.     The Contribution shall be used to finance the activities set forth in the "Slovenia SME NPL
Resolution Single-Donor Trust Fund Description" attached hereto as Annex 1, and shall be
administered by the Bank on behalf of the Donor in accordance with the terms of this Administration
Agreement, including the "Standard Provisions" attached hereto as Annex 2 and "Governance"
attached hereto as Annex 3.
Expected results of the Trust Fund and corresponding indicators (including baselines, result goals and
sources of data) are set out in Annex 4.
The Implementation period shall start on the date following that on which the last of the two parties
signs.
3.     The Donor shall deposit the Contribution in accordance with the following schedule and in the
currency specified in Section I above ("Contribution Currency") into such bank account designated by
the Bank (each amount deposited hereinafter referred to as an "Instalment") upon submission of a
payment request by the Bank:
(A)    Promptly following countersignature E50,000.
(B)    E 25,000 subject to the disbursement of 70% of the preceding instalment.
(C)    E 25,000 subject to the disbursement of 70% of the preceding instalment.
The period for payment of further instalments shall be 60 days.
The period for payment of the balance shall be 60 days.
4.     When making any deposit, the Donor shall instruct its bank to include in its deposit details
information (remittance advice) field of its SWIFT deposit message, information indicating: the
amount deposited, that the deposit is made by the Donor for TF072640 (The Part H Europe 2020
Programmatic Single-Donor Trust Fund), the Commission internal reference number and the date of
the Administration Agreement, the name of the project for which the funds are intended, the name of
1


the Commission department responsible for the Trust Fund and the date of the deposit (the "Deposit
Instructions"). In addition, the Donor shall provide a copy of the Deposit Instructions to the Bank's
Accounting Trust Funds Division by e-mail sent to tfremitadvice@worldbank.org or by fax sent to +1
(202) 614-1315.
5.     Except with respect to the Deposit Instructions, any notice, request or other communication to
be given or made under this Administration Agreement shall be in writing and delivered by mail, fax
or e-mail to the respective Party's address specified below or at such other address as such Party
notifies in writing to the other Party from time to time:
For the Bank (the "Bank Contact"):
Arup Banerji
Country Director
Central, South Europe and Baltics World Bank
Avenue Marnix 17 2nd floor
1000 Brussels Tel: 32-2-504-0994
abanerji@worldbank.org
For the Donor (the "Donor Contact"):
Mary McCarthy
Director
European Commission
Structural Reform Support Service
CHAR 10/104
1049 Brussels Tel: +32 229-93493
Mary.Mccarthy@ec.europa.eu
6.    In the event any amounts are to be returned to the Donor under this Administration
Agreement, the Bank shall transfer such amounts to the Donor, unless otherwise agreed with the Bank.
7.     All annexes hereto and the Framework Agreement between the World Bank Group and the
European Commission constitute an integral part of this Administration Agreement, whose terms
taken together shall constitute the entire agreement and understanding between the Donor and the
Bank. In the event of any inconsistency, the Framework Agreement prevails over the Administration
Agreement and the Administration Agreement prevails over its Annexes. Unless otherwise specified
in an annex hereto, this Administration Agreement may be amended only by written amendment
between the Bank and the Donor.
8.     The measures taken to identify the EU as a source of financing shall be in accordance with
Attachment 4 of the Framework Agreement.
9.     Each of the Parties represents, by confirming its agreement below, that it is authorized to enter
into this Administration Agreement and act in accordance with these terms and conditions. The
Parties are requested to sign and date this Administration Agreement, and upon possession by the
Bank of this fully signed Administration Agreement, this Administration Agreement shall become
effective as of the date of the last signature.
2


INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT
By:
Name: A  Banerji
Title: Country Director
Date:      2     /4/'
EUROPEAN UnON represented by the EUROPEAN COMMISSION
By: _      k <
Name: Mar  cSCcya
Title:  Director           <o Structural
6  ai4        LU   Reform   z
Support  4
Date:    /07 ex Service
'tGeNe
2 8 JUIL. 2016
3


ANNEX 1
Part II Europe 2020 Trust Fund Description
This Annex shall be applicable to and form an integral part of the Administration Agreement for the
Trust Fund between the Bank and the Donor.
1. Objectives
The objectives of the Trust Fund are:
The European Commission and the Bank share a common objective of building competitive and
sustainable economies and reducing poverty and social exclusion - goals of the Europe 2020 Agenda
which is built on three pillars of smart, sustainable and inclusive growth. The European Commission
and the Bank concur that direct interaction is beneficial to both institutions and through them to the
beneficiary countries. This applies particularly to the provision of analytical, advisory and knowledge
services and technical assistance.
The European Commission has expressed an interest in ensuring that the Bank continues to provide
technical assistance in the framework of the Trust Fund in furtherance of the common objective set
forth above.
2. Activities
The objectives and description of the activities are:
The European Commission has expressed an interest in ensuring that the Bank provides technical
assistance in the framework of the Trust Fund with the specific objective of assisting and supporting
the Bank of Slovenia (BoS) to undertake reforms that seek to improve the stability and efficiency of
the country's banking system through restructuring of large volume of non-performing loans (NPLs)
associated with small and medium-sized enterprise (SME) sector. The Activities to be financed by the
Trust Fund, in support of the objective above, and of which the Bank has implementation
responsibility, are described below.
The World Bank Group is an international organization that aims to end extreme poverty and boost
shared prosperity. Promoting financial sector development is essential to achieve these twin goals, and
the Bank assists its member countries to build deep, inclusive, efficient, and stable financial systems in
order to achieve these objectives. Financial stability and NPL resolution are at the core of financial
sector development, and the Bank has gathered substantial expertise in recent years by developing
technical assistance programs around this area. Such programs include a combination of activities that
range from economic analysis, data collection, implementation support and capacity building, which
ultimately achieve the goal of accelerating NPL resolution and promoting more stable and inclusive
financial systems. The expertise acquired by the Bank through financial sector advisory services
activities in the EU, together with its broader knowledge on financial sector development, place the
Bank in a unique position to provide the technical assistance described in this Agreement.
The BoS strategy for 2016 lists SME NPL restructuring among the key policy priorities, and outlines a
two-pronged approach to accelerate the process. On the one hand, as part of their strategies for
managing problem loans, the banks are now required to present for regulator's review specific, time-
4


bound plans for reducing SME NPLs. On the other hand, the Guidelines for SME NPL Restructuring,
prepared jointly by the Bank Association and the BoS in late 2015, and promulgated by the BoS
through a special regulation, extend methodological advice to both banks on: (i) optimal institutional
set up for SME NPL restructuring; (ii) diagnostics for the purpose of quickly determining the viability
of company's business model; (iii) restructuring options for each category of borrowers.
SME NPL restructuring presents specific institutional capacity challenges to banks because of the very
large number of firms involved (around 20,000 entities), poor quality of data, and weak capacity of
borrowers. Standardizing the process through implementation of guidelines is expected to
significantly speed up the process, reduce operational expenses for banks and borrowers, and raise the
frequency of successful restructurings. To this end, the BoS has requested the EC's Structural Reform
Support Service (SRSS) to fund the Technical Assistance activities aimed at enhancing the
institutional capacity of banks to implement (operationalize) the recently adopted guidelines. The
Bank was selected to deliver the requested Technical Assistance based on its regional and global
expertise with NPL restructuring.
Accordingly, the Bank will carry out the following Activities:
1) Development of a toolkit for SME NPL segmentation exercise. The toolkit will contain the
description of data requirements and the methodology for segmentation of SME NPL portfolio
into a number of categories based on standard, objective criteria. Particular consideration will
be allocated to the differences among SMEs, as micro SMEs and medium size SMEs require
different approaches toward NPL resolution. The methodology will focus on providing
specific criteria (e.g. financial ratios, economic sector, and management's ability) for
segmenting NPLs into coherent groups. As part of segmentation exercise, criteria for
borrower's viability analysis will be provided. This analysis will help to streamline bank's
efforts and serve as basis for application of pre-determined solutions.
2) Development of a handbook for SME NPL restructuring. The handbook will provide a
comprehensive framework for effective resolution of SME NPLs. It will contain the major
steps of the resolution process and may serve as a guideline for banks in organizing work of
their internal NPL work-out units.
The handbook will briefly discuss on pros and cons of organizing NPL workout internally or
outsourcing this task. An efficient workout process, if decided to be done internally, needs a
clear organization structure and assignment of workloads. To this end, the handbook will
provide guidance on organization of loan restructuring process within a bank, including
proposals for incentives/performance indicators for staff and management. Furthermore, it will
elaborate of the following aspects: (i) internal operations within the bank, including sequence
and timetable of steps in SME NPL restructuring, (ii) informing the borrowers and the
guarantors, providing details of information to be communicated, (iii) restructuring options
applicable for each category of loans identified as a result of segmentation exercise described
in the above-mentioned toolkit. The handbook will provide guidance on the two major
strategies for NPL resolution: (i) forbearance, and (iii) foreclosure. Both strategies will be
reviewed from the point of view of actions to be taken and documentation needed.
5


For illustrative purposes, sample case studies of NPL workout for various categories of
borrowers will be provided. These examples will illustrate the most common cases, according
to the segmentation process discussed above.
Finally, the handbook will include templates for banks to use common standards in the NPL
workout process. Templates to be included are the following:: (i) restructuring plan
agreement, (ii) standstill agreement; (iii) code of conduct determining banks' engagement
practices with the borrowers; and (iv) following necessary revisions, other relevant templates
currently included in the appendix to the Slovenian principles of financial restructuring of
corporate debt, including (i) template agreement arranging relations between debtor and
creditors, (ii) template agreement on the appointment of the coordinator, and (iii) template
minutes of the meeting between debtor and creditors on potential financial restructuring.
Some of these templates may be left 'as is', amended partially or entirely, or considered not
applicable in the context of SMEs.
3) Presentation of toolkit and handbook at a workshop for banking community organized by the
BoS and the Banking Association. The Bank will organize a workshop (i) to explain the main
findings from the data analysis on SME NPLs (data provided by the BoS), and (ii) provide an
overview of the handbook and the toolkit, with the participation of all major banks, including
state and privately owned, will participate. It is expected that the logistical arrangements will
be provided by BoS.
Methodolo2v:
The World Bank will produce the outputs described above and will deliver them to BoS directly for
approval, endorsement and publication. The World Bank will not be responsible for the
implementation of any of the material outputs.
Provided the Toolkit and Handbook are endorsed by BoS, implementation of the actual loan
restructurings may be achieved following the guidelines and recommendations included in the Toolkit.
Indicative Timeline of Milestones and Outputs
Milestones                                  Delivered by
BoS shares the response to data request with Bank              July 15, 2016
Bank mission to Ljubljana                                      September 2016
Bank presents draft toolkit and handbook to BoS for comments   November 18, 2016
Workshop to present the project outputs organized in Ljubljana  December 2016
WB presents final versions of written outputs to BoS           December 20, 2016
3. Elieible Expenditures
6


3.1    For Bank-executed activities, the Trust Fund funds may be used to finance:
(a) Staff and consultant services;
(b) Cost of travel;
(c) Cost of training and workshop; and
(d) Other services including translation.
4. Taxes
4.1    The foregoing activities and categories of expenditures may include the financing of taxes in
accordance with the Bank's applicable policies and procedures.
5. Proaram Criteria
5.1    Activities are to be financed in accordance with the following program criteria:
The Trust Fund is established to enable the European Commission and the Bank to continue to
collaborate and exchange experience and expertise on a number of themes under all three pillars of the
Europe 2020 Agenda - of smart, sustainable and inclusive growth. The express purpose of this Trust
Fund is to allow the European Commission to avail itself of the Bank's technical assistance and
analytical and policy capacity for the purpose of pursuing the goals of Europe 2020. The three pillars
of Europe 2020 are broadly in line with the objectives and strategies adopted in the Europe and
Central Asia Region of the World Bank Group. All activities that are in pursuance of these three
pillars are eligible to be financed and implemented under this Trust Fund.
7
rV 1A


ANNEX 2
STANDARD PROVISIONS
This Annex shall be applicable to and form an integral part of the Administration Agreement for the
Trust Fund between the Bank and the Donor it being understood that any plural references in the
annexes to Donors, Administration Agreements, Contributions and pro rata shares shall be read as
singular references to the Donor, its Administration Agreement, its Contributions thereunder and the
remaining uncommitted balance of the Trust Fund, respectively.
1.     Administration of the Contributions
1.1    The Bank shall be responsible only for performing those functions specifically set forth in this
Administration Agreement and shall not be subject to any other duties or responsibilities to the Donor,
including, without limitation, any duties or obligations that might otherwise apply to a fiduciary or
trustee under general principles of trust or fiduciary law. Nothing in this Administration Agreement
shall be considered a waiver of any privileges or immunities of the Bank under its Articles of
Agreement or any applicable law, all of which are expressly reserved.
1.2    Each Donor Contribution (collectively, the "Contributions") shall be administered in
accordance with the Bank's applicable policies and procedures, as the same may be amended from
time to time, including its procurement, financial management, disbursement and safeguard policies,
its framework to prevent and combat fraud and corruption and its screening procedures to prevent the
use of Bank resources to finance terrorist activity, in line with the Bank's obligations to give effect to
the relevant decisions of the Security Council taken under Chapter VII of the of Charter of the United
Nations. The Donor acknowledges that this provision does not create any obligations of the Bank
under the anti-terrorist financing and asset control laws, regulations, rules and executive orders of an
individual member country that may apply to the Donor.
2.     Management of the Contributions
2.1    The funds deposited in the Trust Fund shall be accounted for as a single trust fund and shall be
kept separate and apart from the funds of the Bank. The funds deposited in the Trust Fund may be
commingled with other trust fund assets maintained by the Bank. The Bank, in its capacity as trustee,
has legal title to the funds deposited in the Trust Fund.
2.2    The currency in which the funds in the Trust Fund shall be held is Euro (the "Holding
Currency").
2.3    The Donor agrees to deposit its Contributions in the Contribution Currency stated in its
respective Administration Agreements. In the case of deposits received in a Contribution Currency
other than the Holding Currency, promptly upon the receipt of such amounts and the accompanying
Deposit Instructions, the Bank shall convert such amounts into the Holding Currency at the exchange
rate obtained by the Bank on the date of the conversion. Where deposits prove to be insufficient to
complete activities as a result of exchange rate fluctuations, neither the Bank nor the Donor shall bear
any responsibility for providing any additional financing.
2.4    The funds deposited in the Trust Fund may be freely exchanged by the Bank into other
currencies as may facilitate their disbursement at the exchange rate obtained by the Bank on the date
of the conversion.
2.5    The Bank shall invest and reinvest the funds deposited in the Trust Fund pending their
disbursement in accordance with the Bank's applicable policies and procedures for the investment of
8


trust funds administered by the Bank. The Bank shall transfer all income from such investment to the
Donor's applicable donor balance account with the Bank.
3.     Trust Fund Fees and Costs
3.1    The Bank shall deduct and retain for its own account, as a deduction from each Instalment, an
amount equal to five percent (5%) per Instalment as an administrative fee for the Trust Fund.
3.2    The Donor acknowledges and agrees that the percentage deductions for fees in this Trust Fund
Fees and Costs section are estimated on the basis of anticipated Contributions. If actual Contributions
significantly differ from what was originally anticipated at the time of signature of the first
Administration Agreement, or if other circumstances affecting Trust Fund fees or costs change, the
Bank reserves the right to request a change to the terms of this Trust Fund Fees and Costs section,
which would be effectuated by amendments made to the Administration Agreements of the Donor and
which would thereafter be applicable to all new Contributions that are provided either as amendments
to supplement existing Administration Agreements or from new Administration Agreements.
4.     Accounting and Financial Reporting
4.1    The Bank shall maintain separate records and ledger accounts in respect of the funds deposited
in the Trust Fund and disbursements made therefrom.
4.2    The Bank shall furnish to the Donor current financial information relating to receipts,
disbursements and fund balance in the Holding Currency with respect to the Contributions via the
World Bank's Trust Funds Donor Center secure website. Within six (6) months after all commitments
and liabilities under the Trust Fund have been satisfied and the Trust Fund has been closed, the final
financial information relating to receipts, disbursements and fund balance in the Holding Currency
with respect to the Contributions shall be made available to the Donor via the World Bank's Trust
Funds Donor Center secure website.
4.3    The Bank shall provide to the Donor via the World Bank's Trust Fund Donor Center secure
website, within six (6) months following the end of each Bank fiscal year, an annual single audit
report, comprising (i) a management assertion together with an attestation from the Bank's external
auditors concerning the adequacy of internal control over cash-based financial reporting for all cash-
based trust funds as a whole; and (ii) a combined financial statement for all cash-based trust funds
together with the Bank's external auditor's opinion thereon. The cost of the single audit shall be borne
by the Bank.
4.4    If the Donor wishes to request, on an exceptional basis, a financial statement audit by the
Bank's external auditors of the Trust Fund, the Donor and the Bank shall first consult as to whether
such an external audit is necessary. The Bank and the Donor shall agree on the appropriate scope and
terms of reference of such audit. Following agreement on the scope and terms of reference, the Bank
shall arrange for such external audit. The costs of any such audit, including the internal costs of the
Bank with respect to such audit, shall be borne by the requesting Donor.
5.     Progress Reporting
5.1    The Bank shall provide the Donor with semi-annual reports on the progress of activities
financed by the Contributions. Within six (6) months of the End Disbursement Date (as defined
below), the Bank shall furnish to the Donor a final report on the activities financed by the Trust Fund.
5.2    The Donor may review or evaluate activities financed by the Trust Fund at any time up to six
(6) months following the End Disbursement Date. The Donor and the Bank shall agree on the scope
and conduct of such review or evaluation, and the Bank shall provide all relevant information within
9


the limits of the Bank's applicable policies and procedures. All associated costs, including any costs
incurred by the Bank, shall be borne by the Donor. It is understood that any such review or evaluation
will not constitute a financial, compliance or other audit of the Trust Fund.
6.     Disbursement; Cancellation; Refund
6.1   It is expected that the funds deposited in the Trust Fund will be fully disbursed by the Bank by
April 30, 2017 (the "End Disbursement Date"). The Bank shall only disburse funds deposited in the
Trust Fund for the purposes of this Administration Agreement (other than returns to Donor) after such
date to the extent such date is changed in accordance with amendments made to the Administration
Agreement(s) of the Donor. Following the End Disbursement Date, the Bank shall return any
remaining balance of the Trust Fund to the Donor in the Holding Currency in the manner specified in
its respective Administration Agreement on a pro rata basis with regard to the total funds deposited in
the Trust Fund by such Donor relative to the total funds deposited in the Trust Fund by the Donor, all
calculated as Holding Currency amounts.
6.2    The Donor may cancel all or part of such Donor's pro rata share/contribution, and the Bank
may cancel all or any Donor's pro rata share/contribution, upon three (3) months' prior written notice,
of any Contributions (paid and not yet paid) that are not committed pursuant to any agreements
entered into between the Bank and any consultants and/or other third parties for the purposes of this
Administration Agreement, including any Grant Agreements, prior to the receipt of such notice. In the
event of a cancellation, the Bank shall return to the Donor its pro rata share in the Holding Currency as
specified in the Administration Agreement unless otherwise agreed between the Bank and the Donor.
7.     Disclosure; Dispute Resolution
7.1    The Bank shall disclose the Administration Agreements and related information on this Trust
Fund in accordance with the Bank's Policy on Access to Information. By entering into Administration
Agreements, the Donor consents to such disclosure of their respective Administration Agreements and
such related information.
7.2    The Donor and the Bank shall use their best efforts to amicably settle any dispute,
controversy, or claim arising out of or relating to the Administration Agreements.
10
41)/


ANNEX 3
GOVERNANCE FOR THE ACTIVITIES SET FORTH IN SECTION 2 OF ANNEX 1 TO
THIS ADMINISTRATION AGREEMENT
This Annex shall be applicable to and form an integral part of all Administration Agreements between
the Bank and the Donor.
Working Modalities
The Bank will be in charge of the implementation of the activities and shall consult with the Structural
Reform Support Service (SRSS) regularly.
SRSS will take all appropriate measures to facilitate the Bank work in the performance of the
activities, including, as needed, facilitating contacts with Slovenian authorities.
The activities will be undertaken in close collaboration with the SRSS, and the Bank of Slovenia.
In order to facilitate the implementation of the project, the SRSS will be responsible for involving
other EU Commission services, where appropriate. SRSS will also provide support to ensuring the
appropriate involvement of the Slovenian authorities for the smooth execution of the activities by the
Bank. The SRSS, when legally possible, will provide the Bank with relevant documents, reports and
findings, resulting from other technical assistance work streams the SRSS is or has been involved in.
The Bank and SRSS will have regular exchanges on the progress of the project, on the work plan or
schedule of project activities for the following month(s) including missions, and raise any issues as
they arise concerning difficulties encountered. A Representative of the SRSS will be invited to attend
all missions and all pertinent events or activities.
Priorities and choices to be made in the planning of the activities will be discussed and consulted
between the Bank and SRSS. To facilitate the organization and efficiency of missions the Bank will
share with the SRSS in a timely manner the relevant documents.
It is expected that the Director of BoS supervision department will be the national contact Point for the
activities, and will coordinate the necessary coordination mechanisms within BoS, the banking sector,
and other national stakeholders. To this end, the BoS will maintain a Project Management Team,
composed of relevant BoS staff and representatives of the banking community.
It is expected that the Bank will consult and cooperate with the Project Management Team at all major
stages of the activities to be implemented. It is expected that the BoS will provide input for the
analysis of the Bank; comments on the work plan of the project; review draft outputs and provide
detailed comments. It is also expected that the BoS will take the lead in organizing the logistical
aspects of a final workshop to present the final versions of outputs from this Activity.
It is expected that the material outputs produced under the activity (Toolkit, Handbook and Workshop)
will be delivered by the WBG to BoS directly. It is expected that provided BoS approves, endorses
and publishes the outputs, these will be incorporated as part of BoS financial policies in the area of
NPL resolution. However, such approval and publications remains the exclusive responsibility of BoS.
11


It is further anticipated that outcome of the outputs will be used by BoS to inform government's policy
in the area of NPL resolution. This could be subsequently applied by the Government authorities to the
financial sector by the potential introduction of targets for SME restructuring, which financial
institutions would have to achieve over a period of years (pending to be defined).
Achievement of actual impact under the activity depends on a number of factors, like the degree of
implementation of the outputs by BoS or favourable economic factors that remain outside the
responsibility of the World Bank.
Bank team composition:
The Bank shall, in its sole discretion, determine the composition of the staff (including staff holding
consultant appointments) assigned to perform the activities under this Agreement. The Bank team will
be managed by a Bank Task Team Leader with relevant experience, drawing on the expertise of the
World Bank Group staff including personnel and consultants/ experts will extensive experience of
working on Restructuring and NPL resolution frameworks in EU member states and other advanced
jurisdictions. The Bank team will include the following competencies:
-  Ability to analyse the legal, regulatory, institutional and technical impediments to SME NPL
workout, notably in the EU context.
-  Ability to produce high-quality written outputs (toolkit and handbook) providing clear,
detailed guidance to banks' management and personnel on how to implement SME NPL
restructuring in an effective and expedited manner, and minimize transaction costs.
-  Project management, economic, and other skills that will be considered necessary for the
execution of the activities.
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*
ANNEX 4
INDICATIVE RESULTS INDICATORS FOR THE ANNEX 1 ACTIVITIES
Expected       Indicators      Baselines        Result goals   Sources Assumptions
Results                                                        of data
(logic of
intervention)
Impact         Number of       No specific      At least one   Official  BoS approves,
circulars or    regulations exist  government   Gazette  endorses and
Inform BoS's   regulations     in Slovenia today  circular issued       publishes the
policy in the  enacted         on the area of   endorsing the           outputs,
area of NPL    endorsing the   SME NPL          outputs                 incorporating
resolution     outputs         resolution                               them as part of its
financial policies
in the area of
NPL resolution
during the
timeframe of this
Agreement
Reduction of   Official SME    To be provided  To be           BoS      SME
SME NPL        NPL rates,      by BoS', data as  determined    data     restructurings
ratios and     number of       of end 2015      based on                implemented
increase of    restructurings                  baselines                following
SME loan       (forbearance)                   received                 toolkit's
restructurings  cases reported                                          guidance; all
by financial                                             restructurings
institutions                                             reported to BoS;
data made
available
Outcome(s)
Improved       Banks'          Currently there  Individual     BoS      Absence of new
regulatory and  strategies for  are no guidelines  strategies at the  data  economic shocks;
institutional  NPL reduction   or specific     financial                consistent
framework for  are implemented  regulations    institutions             enforcement by
restructuring of in timely and  encouraging     level are               BoS of its
SME NPLs       quality manner  SME NPL's       adopted and              regulations on
workouts         SME loan                NLP recognition
restructurings           and management
are achieved
Output(s)
A. 1 Toolkit for  Approval of  Understanding of Segmentation of BoS     Active
1 This information has already been requested to BoS in the request sent by the WBG in June 2016.
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Segmentation  toolkit by BoS  the different   the NPL stock           engagement of
of SME NPL     and/or Banking  segments       into different          BoS and Banking
portfolio      Association    existing within  categories             Association in
the NPL stock is                        providing
limited                                 information
required for
preparing the
toolkit
A.2 Handbook   Approval of    Limited capacity  Set of        BoS     Active
for SME NPL    handbook by    exists, both on  guidelines and         engagement of
Restructuring  BoS and/or     lenders and     tools for lenders        BoS and Banking
Banking         borrowers' side,  and borrowers         Association in
Association     to reach       to achieve               providing
successful      successful              information
restructurings of  restructurings       required for
SME loans                               preparing the
toolkit
A.3 Workshop   WB presents the  Limited capacity  Raise awareness BoS  Active
on SME NPL     toolkit and    exists, both on  within the              engagement of
Restructuring  handback at the  lenders and   financial                BoS and Banking
workshop for    borrowers' side,  community of          Association in
banking         to reach       the existence of         organizing the
community and   successful      the Toolkit,            workshop
other relevant  restructurings of  encouraging its
national        SME loans       application
stakeholders
14


ANNEX 5
INDICATIVE BUDGET
FOR THE ANNEX 1 ACTIVITIES
Expenditure Category       Average Number      Amount in Euro
Staff and consultant services       4                72,000
Cost of travel                2                20,000
Training and workshops                                0
Other services including                            3,000
translation
Sub-total                                    95,000
Administration fee (5%)                             5,000
Total                                      100,000
The amount estimated for personnel is calculated taking into account different levels of expertise
estimated to be required for carrying out the activities described in Annex 1.
The World Bank Group entity may transfer amounts between categories of the indicative budget. This
does not require an amendment of the Administration Agreement if the Action is carried out as
described in Annex I - Trust Fund description.
The number of units and amounts indicated in the budget are not binding and reflect the means
envisaged for the implementation of the Action. The number of units indicated in the estimated initial
budget may not be used to question the actual number of units reported during and at the end of action.
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