EBRD supports agriculture sector in Turkey

By Ina Coretchi

The EBRD is supporting the development of private businesses in the agriculture sector in Turkey with a credit line in Turkish lira for micro and small enterprises (MSEs).

In its first transaction in the banking sector in Turkey, the EBRD is providing a €20 million equivalent loan (approximately 43 million Turkish lira) to DenizBank, one of the leading private lenders to the agriculture sector in Turkey, to finance its agricultural loan facilities.

Micro and small businesses represent a major part of the Turkish economy, accounting for a large proportion of the country’s businesses and total employment. In the current tight credit markets, MSEs in Turkey face limited access to finance, which constrains their growth.

The EBRD support will enable DenizBank to meet the increasing demand for agricultural loans and to maintain the availability of credits to small companies and farmers in the remote areas in the current challenging environment.

The EBRD credit-line will be used to finance operations of small agricultural producers in Turkey, with loans worth up to €100,000.

“Supporting micro and small-sized companies, including in the agricultural sector, through local banks is a cornerstone of the EBRD strategy in Turkey. The loan provided to DenizBank, which has a wide regional presence in the country, will boost the flow of finance to small agribusinesses and will contribute to further development of the Turkish economy,” said Varel Freeman, EBRD First Vice President.

Hakan Ateş, President of DenizBank Financial Services Group said: “We believe agriculture is of critical importance for sustainable development of our country. With our huge investments in this long-time neglected sector we are the leading private bank in agricultural banking. We once again break a new ground with this credit agreement with EBRD and are proud to contribute to the development of agricultural economy on this occasion”.

DenizBank is the sixth largest bank in Turkey and the leading private bank active in agricultural lending. To date the bank has over 400 branches in more than 60 out of 81 cities in Turkey.

Through this latest transaction, the EBRD is building up its portfolio in Turkey, having already committed €105 million to the Turkish economy. By 2010 the Bank expects to have invested some €450 million in Turkey.

Turkey became a country of the EBRD operations in October 2008.