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European Bank makes equity investment in Estonian Investment Bank
The Board of Directors of the European Bank for Reconstruction and Development yesterday approved an ECU 1.5 million equity investment in the new Estonian Investment Bank -- the first financial institution to be created with European Bank assistance, with cooperation from EC-PHARE and the Nordic countries
The Investment Bank is a special financial institution established to provide medium and long term financing for small and medium sized private companies and companies in transition to privatisation in Estonia.
"This is a truly domestic financial institution that is well capitalised and has an established pipeline", Mario Sarcinelli, Vice President in charge of Development Banking, said. "We expect that the Estonian Investment Bank will be able to quickly finance well-prepared projects, as well as provide a useful training ground for investment banking in Estonia."
The funding from the European Bank will come from the Baltic Investment Special Fund, which is initiated by the Nordic Countries and established and managed by the European Bank. The European Bank's ECU 1.5 million capital investment represents 33.3% of the capital stock. With the Bank of Estonia's ECU 3 million subscription, the total subscribed equity will amount to ECU 4.5 million.
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