An equity investment in Estonian kroons of up to the equivalent of DM 3 million.
The principal objectives of the project are to:
- improve the capitalisation of EMP;
- enable EMP to expand its business operations and to increase lending to private sector enterprises, primarily using its own resources;
- enhance EMP's corporate governance and stature, both domestically and overseas;
- balance the Tallinn-concentrated economic situation in Estonia;
- enhance competition in the Estonian banking market.
EMP is an important institution in the local market, especially in rural areas and outside Tallinn. EMP is commercially oriented, provides a full range of corporate and retail banking services and has a reputation for good client service. In order to expand, and to remain competitive, EMP plans to raise its capital base.
The transition impact of the project will be achieved by:
- investing in a bank which plays a substantial role in diversified regions outside Tallinn. The additional sources of finance would significantly support the improvement of the business environment in smaller cities and rural areas;
- fostering competition in the financial services market, especially by balancing the activities of Tallinn-based commercial banks.
AS Eesti Maapank (EMP) is a joint-stock company incorporated under the laws of Estonia. It is a majority privately owned and privately controlled commercial bank.
The project will consist of the share subscription of 2.4 million newly issued shares of EMP, representing approximately 19.4 per cent of EMP's share capital.
DM 3 million (ECU 1.6 million), all of which will be financed by the EBRD.
EMP will carry out its operations in accordance with the EBRD's Environmental Procedures for Local Banks, which provide for the integration of environmental due diligence into EMP's credit appraisal processes and a requirement that borrowers comply, at a minimum, with national and local health, safety and environmental regulations and standards and public consultation requirements. EMP will submit annual environ-mental reports to the EBRD.
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