Project description
and objectives:
|
This PSD and the investment are subject to the entry into force of the
amendment to the Agreement Establishing the Bank (Article 1) to admit Mongolia
as a country of operations on 15 October 2006.
The proposed project is a senior loan to Xac Bank, a Mongolian commercial bank
focused on microfinance and small business lending, for on-lending to private
micro and small enterprises (MSEs) across Mongolia.
|
Transition impact:
|
Transition impact will be achieved through the strengthening of this leading
local bank which focuses on financing MSEs business needs. The proposed loan
will help Xac Bank to further expand its outreach to regions outside of the
capital. Further improvements in operational efficiency and increased amounts
of MSE financing available through commercial banks are expected to encourage
competition in this sector.
|
The client:
|
Xac Bank is the largest micro-finance institution in Mongolia with 55 branches
(including sub-branches) located in each of the country's regional centres,
including Ulaanbaatar. Xac Bank is a privately owned institution with shares
currently being held by the XAC-GE Group, a holding company (99.8%). XAC-GE
Group’s current owners consist of Mercy Corps (20.06%), three local companies
(Tuushin Co., EIT and NewCom (27.26%) and five local NGOs (15.88%). The
Triodos Doen Fund, ShoreCap International and MicroVest hold 12.45%, 12.45%
and 10.22% of XAC-GE Group’s shares respectively. The remaining 1.68% is owned
by Xac Bank’s employees.
|
EBRD finance:
|
Senior loan of USD 5 million.
|
Total project cost:
|
USD 5 million.
|
Environmental impact:
|
Xac Bank shall introduce into its loan appraisal procedure, implement and
comply with the EBRD Environmental Procedures for Small Loans, which include:
compliance with applicable national environmental, health, safety and labour
requirements; adherence to the Environmental Exclusion and Referral Lists; and
submission of annual environmental reports to the Bank. Xac Bank will benefit
from environmental training for Mongolian FIs that is planned by the EBRD.
|
Technical
cooperation:
|
Xac Bank will benefit from technical assistance under the Mongolia Multi-Bank
Framework. The Framework is designed to encourage EBRD’s partner institutions
(commercial banks and non-bank financial institutions including microfinance
institutions) to develop credit and management skills, set up appropriate
institutional structures for MSE and SME lending and diversify into new
financial products such as leasing, mortgage and trade finance.
For consultant opportunities for projects financed by technical cooperation
funds, visit procurement
of consultants.
|
Company contact:
|
Ganhuyag Ch. Hutagt, Executive Director
Xac Bank Mongolia
Tel: +976 11 318185
Fax: +976 11 328701
E-mail: ganhuyag.ch@xacbank.mn
Website:
www.xacbank.mn
|
EBRD contact:
|
Oksana Pak, Operation Leader: pako@ebrd.com
|
Business opportunities:
|
For business opportunities or procurement, contact the client company.
|
General enquiries:
|
EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168; Fax: +44 20 7338 7380
Email: projectenquiries@ebrd.com
|
