|
EBRD financing to support Azerigazbank
Small enterprises to benefit from new credit line
A finance package from the EBRD will support Azerigazbank, one of
Azeribaijan’s leading private banks, in its drive to broaden its client base
and to provide longer term loans for its small business clients. In addition
to a $6 million credit line for on-lending to micro, small and medium-sized
enterprises the Bank will also expand its cooperation with Azerigazbank under
the Trade Facilitation Programme.
Under the new agreement worth $4.5 million, EBRD will provide Azerigazbank not
only with guarantees covering the obligations of Azerigazbank in connection
with international trade finance but also with cash advances to finance
pre-export, post-import, local distribution and factoring activities of the
bank.
Azerbaijan’s economy has been growing exceptionally since the opening of the
BTC pipeline last year and as a result the banking sector is also expanding
rapidly. The new credit line will allow Azerigazbank to extend its lending
operations and to provide clients with longer-term loans. The credit line will
be complemented with Technical Cooperation funds for staff training and
improved procedures.
Azerigazbank, set up in 1992, focuses its activities on private sector
customers, mainly in the oil and trading sectors, as well as on small and
medium-sized enterprises. It was a pioneer in launching consumer finance and
credit card services. The EBRD and Azerigazbank have been working together
since 1998 and the bank has received three credit lines and has participated
in the Trade Facilitation Programme.
With the development of Azerbaijan’s economy, international trade is expanding
and Azerigazbank’s clients’ demand for trade instruments is increasing.
Transactions carried out under TFP so far have covered deliveries of
industrial equipment, consumer goods and electric appliances from France,
Germany, Turkey and South Korea to Azerbaijan. The conversion into a
cross-limit will allow Azerigazbank to provide trade finance banking solutions
to its clients for the pre-export and post-import phases of trade including
domestic distribution and factoring.
Kurt Geiger, EBRD Business Group Director Financial Institutions, said the new
finance package will contribute to the evolution of a broadly-based banking
system by strengthening one of the country’s leading private banks. The credit
line to Azerigazbank is expected to ease the access to finance for many micro,
small and medium-sized enterprises. This in turn will contribute to the
diversification of Azerbaijan’s economy.
|
