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EBRD provides US$ 20 million for Russian small loans
The European Bank for Reconstruction and Development (EBRD) has signed a loan agreement with AvtoVAZbank to provide medium-term lending of an average of US$ 50,000 equivalent to small private companies. It is similar to the loan agreement signed with Mosbusinessbank last week. The US$ 10 million loan agreement is part of the US$ 300 million Russia Small Business Fund set up jointly with the G-7 countries to help small and medium enterprises (SMEs) in Russia.
The proceeds of the loan will allow AvtoVAZbank to provide medium-term financing, which is generally not available on the Russian market for small private companies. Guy de Selliers, Deputy Vice President of the EBRD, said: "AvtoVAZbank's participation in the Small Business Fund programme contributes to the rapid build up of a comprehensive network of Russian banks providing medium term financing to small businesses. AvtoVAZbank and Mosbusinessbank are also making great strides in strengthening their client services."
AvtoVAZbank's involvement in the Russia Small Business Fund will widen the programme's reach through its branch network and develop the programme on a larger scale, especially in the Volga region, Siberia and St Petersburg. AvtoVAZbank is headquartered in Togliatti.
AvtoVAZbank will also be participating in the World Bank-EBRD Financial Institutions Development Programme. Under the training programme the EBRD is introducing credit, monitoring and information systems, which are not available to most Russian banks. This loan complements other EBRD initiatives which include an equity fund for small businesses, the Smolensk Regional Venture fund, as well as micro-lending for very small companies.
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