EBRD supports businesses in Armenia, Mongolia and Uzbekistan through multi-million loans
AKIPRESS.COM – The European Bank for Reconstruction and Development is sharing the risk on six loans worth $24.3 million provided by partner banks in Armenia, Mongolia and Uzbekistan. These latest transactions under the EBRD’s Risk Sharing Framework will support local businesses, EU Reporter saysjavascript:mctmp(0);.
The EBRD is using its Risk Sharing Framework (RSF) to support the expansion of domestic businesses in the three countries concerned and boost the lending capacity of local partner banks. At the EBRD’s 33rd Annual Meeting and Business Forum in Yerevan, the Bank agreed to share half of the risk on six loans provided by local banks with a collective value of $24.3 million.
These transactions under the risk sharing agreements between the EBRD and local lenders will help to unlock new financing and growth opportunities for local companies.
In Armenia, the EBRD is sharing the risk on a $15.7 million loan provided by InecoBank to the TUMO Center for Creative Technologies. The funds will support the establishment of TUMO’s new hub fostering innovation and economic growth in Armenia. The European Union is also contributing $12.5 million towards the total cost of the project.
The EBRD is also sharing the risk on a $1.2 million loan provided by InecoBank to the Karas Group, a leading fast-food chain in Armenia. The loan will help the company to develop and implement its new marketing strategy and renovate 28 of its outlets.
In Mongolia, the EBRD will share the risk on a $1.2 million working capital loan provided by XacBank to MyMonSource, a supplier of electrical equipment. The loan will help to meet the company’s working capital needs and finance the procurement of new electrical engineering products. MyMonSource will also receive a grant of up to €110,000 under the EBRD’s Skills in Business programme, helping it to attract, train and retain local talent.
In Uzbekistan, the EBRD will share the risk on two loans provided by Hamkorbank: one to Avtobus Rent, a leading private car and bus rental company, and the other to Tillo Domor, an Urgench-based cheese producer. A $1.1 million loan to Avtobus Rent will support the acquisition of new passenger vehicles, helping to meet the growing demand for comfortable transport for tourists in Uzbekistan. This project is supported by a $90,500 grant provided by the Swiss State Secretariat for Economic Affairs through the EBRD’s Small Business Impact Fund. Meanwhile, a $3.1 million loan to Tillo Domor will enable the firm to complete the construction of its new dairy production plant by the end of 2024.
Lastly, the EBRD has agreed to share the risk on a $2 million loan that Uzbekistan’s SQB is providing to Qadrli, a local manufacturer of flour and wheat-based products, which will allow the firm to procure more wheat and meet the growing demand for its products.
The RSF is a strategic framework under the Bank’s Small Business Initiative that is dedicated to growing and developing the private sector in the EBRD regions. The RSF enables the Bank to share the risk on partner banks’ loans to eligible enterprises that are in need of working capital, helping those businesses to grow and become more competitive.
To date, the EBRD has partnered with 38 local financial institutions, facilitating more than 400 RSF sub-loans to small and medium-sized enterprises with a total value of over €1 billion.
