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Estonia's Eesti Forekspank wins EBRD support
Private sector enterprises in Estonia will benefit from DM 12 million (ECU 6.5 million) of new medium-term financing by way of a credit line which the European Bank for Reconstruction and Development (EBRD) has extended to AS Eesti Forekspank (EFP), one of Estonia's leading commercial banks.
"The EBRD is committed to strengthening local bank financing of private sector enterprises in Estonia," said David Hexter, Deputy Vice-President at the EBRD. "The funds will enable Forekspank to make more funds available to the corporate banking market in Estonia and encourage international banks to increase their lending to Forekspank and other Estonian banks."
Designed to finance projects of up to DM 1.5 million in the small and medium-sized enterprises sector, the EBRD credit line will be disbursed in two tranches of DM 8 million and DM 4 million. EFP has already targeted companies which have demonstrated growth potential based on past performance, in the trade, property and timber sectors.
Founded in June 1992, EFP merged with Raepank, another small but strong Estonian bank with total assets of DM 29 million (ECU 16 million), at the end of 1995. EFP is now the sixth largest bank in Estonia in asset size, and is the leading bank for transactions denominated in CIS currencies. It is 100 per cent privately owned and 20 per cent of its capital is held by foreign shareholders. EFP will offer its corporate and private clients a wide range of financial products at competitive rates.
To date, the EBRD has extended six credit lines for an aggregate value of DM 86 million (ECU 45 million) to five other Estonian banks (the Estonian Investment Bank, Hoiupank, Uhispank, Tallinna Pank and Hansapank) and recently extended a second line to Hansapank. As of 30 June 1996, the EBRD has signed commitments of DM 277 million (ECU 147 million) to Estonia, of which DM 87 million (ECU 46 million) is to the financial sector.
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