New financing for agricultural enterprises, women-led businesses and energy efficiency investments
The European Bank for Reconstruction and Development (EBRD) is extending a US$ 127.5 million financial package to the İșbank to support small and medium-sized enterprises (SMEs) in Turkey.
SMEs constitute a vital part of the Turkish economy and account for 80 per cent of the country’s employment and 60 per cent of its exports. Supporting local small businesses with better access to finance is a priority for the EBRD.
The Bank’s funds will be on-lent to SMEs across Turkey with a focus on loans to agricultural enterprises, SMEs that want to improve their energy efficiency, small-scale renewable energy generators and women-led businesses.
The new loan follows a €50 million facility extended to İșbank in May 2013 and is supported by grant-based technical assistance from the European Union and the Clean Technology Fund.
Sylvia Gansser-Potts, EBRD Director for Financial Institutions in Turkey and Southern and Eastern Mediterranean, said: “Through Ișbank’s extensive network the EBRD is able to reach out to SMEs also in remote regions, where financing is needed most. Our new loan is a response to the strong demand with which our first facility to İșbank has been met and we are pleased to expand our cooperation.”
İșbank is the largest private bank in Turkey, in terms of assets, with a market share of 12.6 per cent as of September 2014. It also has the largest branch network among private banks in the country with more than 1,300 domestic branches.
Yilmaz Erturk, Deputy Chief Executive of İșbank said: “We have been cooperating with EBRD since 2010. Our cooperation develops more over the years. We pay particular attention to the SME sector which is considered as the engine of growth for the Turkish economy and we support them in each economic conjuncture. This facility is expected to encourage and promote women’s entrepreneurship in Turkey and make a positive impact on agricultural enterprises, as well as on SMEs that intend to improve their energy efficiency.”
The EBRD has a strong track record of providing finance to Turkish banks for on-lending to local SMEs. To date, the Bank has provided finance worth €1.6 billion to local lenders in Turkey.
The EBRD started investing in Turkey in 2009 and currently operates from offices in Istanbul, Ankara and Gaziantep. To date, the Bank has invested almost €4.5 billion in the country in more than 130 projects in infrastructure, energy, agribusiness, industry and finance. In just five years the EBRD’s portfolio in Turkey has become one of the largest among the countries where the Bank invests.