FIF - Bailyk Finance MSE Loan

Location:

Kyrgyz Republic

Project number:

51885

Business sector:

Financial institutions

Notice type:

Private

Environmental category:

FI

Approval date:

20 Jul 2021

Status:

Approved

PSD disclosed:

22 Jul 2021

As per section 1.4.2 (iii) of the Directive on Access to Information: "For Projects approved by Bank management where the Board of Directors has delegated the approval authority, the PSD shall be disclosed at the start of the relevant no-objection notification period to a member country of the Bank in accordance with Article 13 (iii) of the Agreement Establishing the EBRD."

Project Description

Provision of a senior loan under the Financial Institution Framework (FIF) in the total amount of up to USD 2m equivalent to be disbursed in local currency (LCY) in two equal tranches of USD 1m each, with the second tranche to be provided on an uncommitted basis. The commitment of the second tranche will be delegated to management.

Project Objectives

The project aims at supporting LCY lending to eligible Kyrgyzstan micro and small enterprises (MSEs) in accordance with FIF.

Transition Impact

ETI score: 60

Competitive: The loan will support BF in growing its MSE portfolio and expanding access to LCY finance to sub-borrowers located primarily in the country's remote regions with a focus on attracting new clients. 

Resilient: The project aims to ensure prudent lending practices and adequate portfolio quality.

Client Information

BAILYK FINANCE MICROCREDIT COMPANY LLC

Bailyk Finance ("BF", "The company") is currently the third largest micro-finance institution in Kyrgyzstan. As of end-March 2021 BF reported net loans of USD 22.9m, total assets of USD 27.1m, equity of USD 5.2m (under IFRS) and regulatory CAR of 18%.

EBRD Finance Summary

USD 2,000,000.00

Total Project Cost

USD 2,000,000.00

Additionality

Additionality sources: (i) EBRD offers medium term financing that is not available on the market from commercial sources on reasonable terms and conditions, (ii) EBRD offers local currency financing on terms not readily available in the market.

Environmental and Social Summary

Categorised FI (2019 ESP).  BF will be required to comply with EBRD's Performance Requirements (PRs) 2, 4 and 9, adopt and implement the EBRD's E&S Risk Management Procedures for SME and Micro loans and submit Annual Environmental and Social Reports to the Bank.

Technical Cooperation and Grant Financing

None.

Company Contact Information

Arzymat Derbishaliev
aderbishaliev@bf.kg
+996 701 511 761
www.bf.kg
48a, Abay str., Bishkek

PSD last updated

22 Jul 2021

Understanding Transition

Further information regarding the EBRD’s approach to measuring transition impact is available here.

Business opportunities

For business opportunities or procurement, contact the client company.

For business opportunities with EBRD (not related to procurement) contact:

Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com

For state-sector projects, visit EBRD Procurement:

Tel: +44 20 7338 6794
Email: procurement@ebrd.com

General enquiries

Specific enquiries can be made using the EBRD Enquiries form.

Environmental and Social Policy (ESP)

The ESP and the associated Performance Requirements (PRs) set out the ways in which the EBRD implements its commitment to promoting “environmentally sound and sustainable development”.  The ESP and the PRs include specific provisions for clients to comply with the applicable requirements of national laws on public information and consultation as well as to establish a grievance mechanism to receive and facilitate resolution of stakeholders’ concerns and grievances, in particular, about environmental and social performance of the client and the project. Proportionate to the nature and scale of a project’s environmental and social risks and impacts, the EBRD additionally requires its clients to disclose information, as appropriate, about the risks and impacts arising from projects or to undertake meaningful consultation with stakeholders and consider and respond to their feedback.

More information on the EBRD’s practices in this regard is set out in the ESP.

Integrity and Compliance

The EBRD's Office of the Chief Compliance Officer (OCCO) promotes good governance and ensures that the highest standards of integrity are applied to all activities of the Bank in accordance with international best practice. Integrity due diligence is conducted on all Bank clients to ensure that projects do not present unacceptable integrity or reputational risks to the Bank. The Bank believes that identifying and resolving issues at the project assessment approval stages is the most effective means of ensuring the integrity of Bank transactions. OCCO plays a key role in these protective efforts, and also helps to monitor integrity risks in projects post-investment.

OCCO is also responsible for investigating allegations of fraud, corruption and misconduct in EBRD-financed projects. Anyone, both within or outside the Bank, who suspects fraud or corruption should submit a written report to the Chief Compliance Officer by email to compliance@ebrd.com. All matters reported will be handled by OCCO for follow-up. All reports, including anonymous ones, will be reviewed. Reports can be made in any language of the Bank or of the Bank's countries of operation. The information provided must be made in good faith.

Access to Information Policy (AIP)

The AIP sets out how the EBRD discloses information and consults with its stakeholders so as to promote better awareness and understanding of its strategies, policies and operations following its entry into force on 1 January 2020. Please visit the Access to Information Policy page to find out what information is available from the EBRD website.

Specific requests for information can be made using the EBRD Enquiries form.

Independent Project Accountability Mechanism (IPAM)

If efforts to address environmental, social or public disclosure concerns with the Client or the Bank are unsuccessful (e.g. through the Client’s Project-level grievance mechanism or through direct engagement with Bank management), individuals and organisations may seek to address their concerns through the EBRD’s Independent Project Accountability Mechanism (IPAM).

IPAM independently reviews Project issues that are believed to have caused (or to be likely to cause) harm. The purpose of the Mechanism is: to support dialogue between Project stakeholders to resolve environmental, social and public disclosure issues; to determine whether the Bank has complied with its Environmental and Social Policy or Project-specific provisions of its Access to Information Policy; and where applicable, to address any existing non-compliance with these policies, while preventing future non-compliance by the Bank.

Please visit the Independent Project Accountability Mechanism webpage to find out more about IPAM and its mandate; how to submit a Request for review; or contact IPAM  via email ipam@ebrd.com to get guidance and more information on IPAM and how to submit a request.

 

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