The European Bank for Reconstruction and Development (EBRD) has provided a financing package to its partner bank in the Kyrgyz Republic, Demir Kyrgyz International Bank (DKIB), aimed at supporting small and medium-sized companies and mortgage lending.
The loan will be provided in local currency, som, to the amount of US$ 5 million. The local currency loan is possible thanks to support from international donors through the EBRD’s Early Transition Countries Fund*.
Of the total amount, the equivalent of US$ 3 million will be on-lent to small and medium-sized enterprises (SMEs). US$ 2 million equivalent will be used by DKIB for mortgage lending.
“The new financing package will help DKIB access longer-term financing in Kyrgyz som,” Sevki Sarilar, General Manager of DKIB, said at the signing. “DKIB will further contribute to the development of the country’s economy by supporting small and medium-sized businesses. It will help end-borrowers to avoid foreign-exchange risks by providing local currency sub-loans in Kyrgyz som.”
The mortgage loan will support DKIB in developing the country's mortgage market and promoting the best business practices. The financing comes with a requirement to implement the EBRD’s list of minimum standards for mortgage loans.
DKIB is the third-largest bank by total deposits in the Kyrgyz Republic. The EBRD is a shareholder in the bank, where it now holds 7.5 per cent of equity.
To date, the EBRD has invested over €560 million in more than 130 projects in the Kyrgyz Republic.
*Donors to the Early Transition Countries Fund are: Canada, Finland, Germany, Ireland, Japan, Korea, Luxembourg, the Netherlands, Norway, Spain, Sweden, Switzerland, Taipei China and the United Kingdom.