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EBRD funding for Georgia's financial sector
To help meet the need for sound private sector financial institutions in Georgia and to boost the emerging private sector in the country, the European Bank for Reconstruction and Development (EBRD) has set up a framework loan programme, under which US$ 12 million (ECU 9.6 million) will be lent to selected private sector Georgian banks for on-lending to small and medium-sized enterprises (SMEs).
"The SME credit line is a well-tested means of boosting the financial sector and at the same time assisting the development of SMEs. It will guarantee the effective supervision and regulation of banks and will meet the financing needs of new private sector SMEs," commented Olivier Descamps, Director of the EBRD's Georgia team.
Guaranteed by the Government of Georgia, the programme will provide term finance for investment, working capital and trade finance of eligible private sector SMEs. Three banks will initially benefit from the loan programme: TBC Bank, TbilCreditBank and TbilComBank. Additional banks may qualify for the remaining amount of the credit line.
The country has a two-tier banking system which was created in 1991. It consists of the National Bank of Georgia and about 60 small domestic commercial banks, of which 45 have been certified by the National Bank.
Georgia has a tradition of entrepreneurship, with about 50 per cent of GDP now accounted for by the private sector. There are more than 65,000 registered small businesses, and almost 10,000 small-scale enterprises had been privatised by June 1996.
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