Elektrokrajina seeks €38 million EBRD financing to modernize Bosnia’s power distribution and refinance debt

Bosnia and Herzegovina’s electricity distribution sector is moving toward a major balance-sheet and infrastructure reset, with Elektrokrajina preparing to approach shareholders for external funding. The company is seeking an EBRD loan of €38 million, combining network modernization with a refinancing component designed to improve financial resilience.

The proposal centers on upgrades tied to distribution network as well as the refinancing of part of Elektrokrajina’s existing debt. Management says the plan will be submitted for consideration at an upcoming shareholders’ assembly, where approval is required before the process can proceed.

Loan terms: long tenor, Euribor-linked pricing, and defined fees

If approved, the financing would carry a maturity of up to 20 years, including a four-year grace period. The interest rate is expected to be linked to six-month Euribor plus 1%, aligning with market conditions typically used for this type of arrangement.

The overall package also includes additional charges: an 1% approval fee, plus a commitment fee of 0.5% per year on undrawn funds. Elektrokrajina estimates that arranging and implementing the credit line will cost around €13.8 million, which it intends to cover using its own resources.

Where the money goes: medium- and low-voltage rehabilitation

The bulk of the proceeds—approximately €30 million—is earmarked for rehabilitation and reconstruction of medium- and low-voltage electricity infrastructure. Company documents describe this as a key step in modernizing the network and supporting improved system performance.

Management characterizes the project as one of its most significant planned infrastructure initiatives, focused on raising reliability and service quality for consumers across its distribution area. The upgrades are expected to reduce both the frequency and duration of power outages while improving service standards.

Refinancing aimed at stability beyond construction spending

A separate element of the financing is intended to strengthen Elektrokrajina’s financial position through restructuring existing liabilities. By adjusting its obligations under the new credit facility, the company aims to improve its balance sheet and support more sustainable operations over time.

Elektrokrajina argues that borrowing is economically justified based on what it describes as strategic importance of network modernization, relatively favorable financing terms, and anticipated operational as well as financial benefits.

The company has also confirmed that the investment program will be carried out across its entire distribution network, positioning it among the most extensive utility modernization projects currently planned in the Republic of Srpska.