A five-year GEL denominated senior unsecured loan in amount of USD 20 mln provided to Bank of Georgia ("BoG"), one of the largest systemic banks operating in Georgia. The project will further promote the Eastern Partnership SME Competitiveness ("EaP SMEC") Programme, a successor to the DCFTA Programme, in which BoG has actively participated since 2016.
The proceeds of the Bank's investment will be on-lent by the bank in line with EaP SMEC Programme' Policy Statement to private sector sub-borrowers (MSMEs) to upgrade their technologies and equipment up to EU standards, including for investments in sustainable technologies and promotion of the use of green technologies, enhancing MSMEs' competitiveness. At least 70% of the loan is expected to be GET-eligible, in line with the EaP SMEC programme terms.
ETI score: 75
Competitive: The company will expand its MSME portfolio with a focus on financing priority investments complying with EU directive(s), ultimately facilitating competitiveness of Georgian MSMEs, as well as provide business advice to SMEs in DCFTA-related areas.
Resilient: the company is expected to maintain adequate MSME portfolio quality.
BANK OF GEORGIA JSC
JSC Bank of Georgia (Moody's Ba2 and Fitch BB- with stable outlook) accounts for over one-third of the banking sector's assets and liabilities and is categorized as a systemic bank by the regulator. JSC Bank of Georgia is fully owned by Bank of Georgia Group PLC, UK incorporated holding company included in the FTSE Small Cap and FTSE ALL-share Index Funds on London Stock Exchange.
EBRD Finance Summary
Total Project Cost
Key sources of additionality under the project are:
(i) Financing structure that is not available in the market (medium to long term funding in local currency) and innovative green finance instrument that integrates climate and ESG considerations into the financing structure; and
(ii) Knowledge, innovation and capacity building (technical assistance under the programme will support timely realisation of EU compliant investments in Georgia);
Environmental and Social Summary
Categorised FI (ESP 2019). Bank of Georgia is a well-known client to the Bank through a number of transactions over a number of years. BoG has a well-developed suite of policies, remains compliant with the Bank's key performance requirements and provides timely reporting on related topics.
Technical Cooperation and Grant Financing
SME Competitiveness credit line will be complemented by grant funding (TC and non-TC) sponsored by the EU: MSME sub-borrowers will benefit from investment incentives (up to 15% of the lower of disbursed amount or the investment cost, depending on type of sub-project) for eligible sub-loans, while BoG will receive technical assistance from dedicated consultants towards investment projects preparation and implementation.
Company Contact Information
29a Gagarini street, Tbilisi, Georgia
PSD last updated
04 Aug 2022
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