The proposed Framework to the amount of US$ 25.0 million consists of senior loans to commercial banks in the Republic of Belarus. Under this Framework, loans will be extended directly to the participating local banks which will in turn on-lend these funds to private Micro, Small and Medium-sized Enterprises.
Initially two banks will be considered for participation in the Framework: Belgazprombank (BGPB) and Prior Bank (Prior). Additional private banks will be included in the Framework at a later stage. The Framework will enable EBRD to meet the growing demand for finance from Micro, Small and Medium-sized Enterprises across Belarus and to further strengthen institution building in the Belarusian banking sector.
The Facility is expected to have an excellent transition impact as it will provide support to and contribute to the growth of the private sector banks. By working with banks active throughout the country, the project will support the development of a more broadly-based banking system and allow for a deeper outreach to Micro, Small and Medium-sized Enterprises throughout the country.
The Framework will provide swift access to much needed financing for Micro, Small and Medium-sized Enterprises on a commercial and sustainable basis. The project will also demonstrate to other local banks that lending to the Micro, Small and Medium-sized Enterprises sector is commercially viable and will, therefore, encourage them to cater for this market niche and improve the overall level of financial services provided to Belarusian entrepreneurs. Policy dialogue with the Government of Belarus on private sector development issues will continue.
The two potential clients under the Frameworks are:
Joint Belarusian-Russian Open Joint-Stock Company “Belgazprombank” is a medium-sized commercial bank, the eighth largest commercial bank of Belarus by the size of its equity and assets base. The Bank is owned by Gazprom (33.91%), Gazprombank (33.91%), Belarusian Ministry of Economy (8.63%) and Beltransgaz (23.5%).
Prior is a Joint Stock Company owned by Raiffeisen Zentralbank Österreich AG (“RZB”) through its wholly owned subsidiary Raiffeisen International AG (“RI”) (61.3%), EBRD (13.5%) and others (25.2% with the individual stakes of under 3%). Prior is the third largest bank in Belarus in terms of equity (8.8% market share), assets (10.9%) and loan portfolio (10.5%), as of end-2003 and the largest private bank, as well as the only subsidiary of a western bank in Belarus.
The Framework will consist of credit lines in the total amount of US$ 25 million, of which Belgazprombank and Prior Bank will receive US$ 6 million and US$ 10 million respectively.
US$ 25 million.
The project will be carried out in accordance with EBRD’s Environmental Procedures for Intermediate Financing through Local Bank and Environmental Procedures for Small and Micro Loans.
Both Priorbank and Belgazprombank demonstrated full compliance with EBRD’s environmental requirements for financial institutions within the existing sovereign guaranteed Belarus Credit Line for Small and Medium-Sized Enterprises.
It is envisaged that the proposed Framework will be accompanied by technical co-operation for Micro and Small-Enterprises component that is currently estimated at € 1.0 million for the next 24 months.
To date, US$ 150,000 has been preliminary approved by USAID with other sources of funding being explored as well. Eligibility for TC will be prioritised in favour of smaller local banks.
Mrs Avramenko Tatiana, Head of MSE/SME unit
60/2, Pritytskiy str.,
Republic of Belarus,
Tel: +375 17 2594157
Mrs Shishenko Elena, Director of Structured and Project Finance division
31-A, Khoruzhei str.,
Republic of Belarus,
Tel: +375 17 2173447
For business opportunities or procurement, contact the client company.
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