The EBRD is boosting the availability of financing to private businesses in Moldova with a new credit line for on-lending to small and medium enterprises (SMEs).
Responding to the current difficult market conditions, the EBRD is lending €15 million to C. B. Moldindconbank (MICB) to support the development of its portfolio of SMEs credits.
As a result of the global credit crisis, Moldovan banks have significantly limited their lending activities, small and medium-sized companies being particularly affected.
The EBRD funds will enable Moldindconbank, one of the largest banks in Moldova, to address the stringent need for SME financing in the country in the current tight credit market.
The proceeds of the credit line will be used to finance investments and working capital of Moldovan SMEs with medium and long-term loans worth up to €1 million.
The EBRD loan will be supported by technical assistance grants worth €90,000 under the Moldova-Financial Sector Framework.
“This transaction reinforces the EBRD’s commitment to support the real economy sector in Moldova in the current challenging environment. The credit line to Moldindconbank will increase the availability of the much needed financing to SMEs and will support their development,” said Nick Tesseyman, EBRD Business Group Director for Financial Institutions.
“The co-operation with the EBRD is of significant importance for Moldindconbank, especially when this is dedicated to the SME sector which is important for the country development,” said Svetlana Banari, President of MICB. “MICB is strategically dedicated to the Moldovan SME sector and the co-operation with the EBRD will play a catalytic role in attracting other investors to the country and long term financing for the Moldovan banks”, she said.
Moldindconbank is the fourth largest bank in Moldova by assets and third by gross loans and total deposits, holding an approximately 11 per cent of the market share.
To date the EBRD has committed more than €300 million in various sectors of the Moldovan economy. The EBRD funds mobilised additional investments in excess of €240 million.