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EBRD equity investment supports Bulgaria's banking sector
The European Bank for Reconstruction and Development (EBRD) is continuing its support for the future development of Bulgaria's banking sector by taking a US$ 6 million (ECU 5.2 million) equity investment in First Investment Bank Ltd (FIB). The subscription to newly issued shares represents approximately 20 per cent of FIB's enlarged capital.
"The EBRD's equity investment demonstrates the EBRD's confidence in the reform process now under way in Bulgaria, especially in banking," said David Hexter, Deputy Vice President of the EBRD. He continued: "It is fully consistent with the EBRD's strategy for Bulgaria, which aims to advance the country's transition towards a market-oriented economy by strengthening the banking sector. This is also in line with the International Monetary Fund's recommendations."
Designed to expand FIB's capital base, the EBRD's investment will also contribute towards the development of the bank's loan portfolio, especially medium-term lending to small and medium-sized private sector enterprises.
Founded in 1993, FIB is 100 per cent privately owned and its objective is to become a full-service corporate bank catering for the emerging private sector in Bulgaria. In its three years of operations, FIB's reputation for good management has helped it become one of Bulgaria's leading private banks.
The equity investment will be the EBRD's second financing with FIB following a bank-to-bank loan in the form of a US$ 4 million (ECU 3.2 million) credit line signed on 23 October 1996.
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