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EBRD and Bank Republic promote mortgage lending in Georgia
$8 million loan will benefit local residents
Residents in Georgia will gain access to long-term financing to buy, build or
refurbish properties following a $8 million loan from the EBRD to Bank
Republic Societe Generale Group (BR), the sixth largest privately owned bank
in Georgia.
The 10-year loan will enable BR to provide its clients with long-term mortgage
financing. It will also increase competition in Georgia’s mortgage lending
sector which is still underdeveloped.
BR will also benefit from Technical Cooperation funds of €300,000 provided by
the ETC Multi-Donor Fund to support the improvement of its mortgage operations
and staff training. A separate initiative will support improvement of the
legislative and institutional framework applicable to residential mortgages.
The loan builds on the previous cooperation between the two institutions,
including a $3 million credit line for on-lending to medium and small
enterprises and $5 million under the EBRD’s Trade Facilitation Programme. The
EBRD also holds 10 per cent of BR’s shares alongside Societe Generale (SG).
Mike Davey, EBRD Director for the Caucasus, said that while the demand for
mortgage finance in Georgia is growing the supply of such finance from local
commercial sources is still limited. The loan to Bank Republic will help
overcome this obstacle. In addition, it will help establish best practice in
Georgia’s banking sector.
The EBRD, one of the largest private sector investors in Georgia, has to-date
signed a total of 64 investment projects in the country covering energy,
transport, agribusiness, general industry and banking for a total commitment
of almost €400 million.
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