FIF - MFO KMF MSME Syndicated Loan

Location:

Kazakhstan

Project number:

50164

Business sector:

Non-depository Credit (non bank)

Notice type:

Private

Environmental category:

FI

Approval date:

30 Jan 2019

Status:

Disbursing

PSD disclosed:

20 Dec 2018

Translated versions of this PSD: Kazakh | Russian

Project Description

A syndicated loan of up to USD 50 million (in KZT equivalent) to Microfinance organisation KMF ("KMF"), a limited liability company, comprising an A Loan of up to USD 10 million to be provided by the EBRD and a B Loan for up to USD 40 million. The B Loan will be syndicated in hard currency. The EBRD will execute a cross currency swap and provide the loan to KMF in the local currency. If successful, this will be the first syndicated loan arranged by the Bank with a cross-currency swap.

Project Objectives

The syndicated loan will allow KMF to continue providing funding in the local currency to micro, small and medium-sized enterprises (("MSMEs") in Kazakhstan and will also encourage private lenders to provide longer-term funding to non-bank financial institutions in Kazakhstan.

Transition Impact

This Project will further enhance the transition impact made by the EBRD to date and support KMF competitiveness by facilitating the development of its MSME loan portfolio with focus on new and
regional borrowers using the company's country-wide network. Requirements to comply with financial covenants and portfolio quality ratios will also contribute to resilience of the institution.

Client Information

MFO KMF LLC

MFO KMF is the largest private MFO in Kazakhstan with a market share of over 52%, total assets of USD 336m, total equity of USD 70.3m, over 220k of active clients and 114 offices (14 branches and 100 outlets). KMF's principal shareholders are three international funds with a joint stake of 90.0%.

EBRD Finance Summary

USD 10,000,000.00

Total Project Cost

USD 50,000,000.00

Environmental and Social Summary

Categorised FI (2014 ESP). MFO KMF, Kazakhstan, is an existing EBRD client and is compliant with PRs 2, 4 and 9 under existing exposures. The borrower has an Environmental and Social
Management System (ESMS) in place since 2014 and has provided satisfactory reporting to date on E&S matters. KMF should continue to apply EBRD's E&S Risk Management Procedures for MSME
loans, comply with the PRs and submit annual E&S reports to the EBRD.

Technical Cooperation

KMF will benefit from training to be provided under the Regional Small Business Programme for Central Asia. The RSBP focuses on centralised knowledge sharing for banks, non-bank microfinance
institutions and other facilitators of MSME-finance via an electronic knowledge sharing and exchange platform as well as seminars on specialised subjects.

Company Contact Information

Elena Skufalyaridy
elena.skufa@kmf.kz
+7 (727) 331-74-74, ext. 156
www.kmf.kz

Business opportunities

For business opportunities or procurement, contact the client company.

For state-sector projects, visit EBRD Procurement: Tel: +44 20 7338 6794
Email: procurement@ebrd.com

General enquiries

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

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Text of the PIP

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 how to submit a Request for review through our confidential online form, by email, mail or telephone. IPAM is available to discuss your concerns and answer any questions you may have about the submission or handling of Requests, which follow the Project Accountability Policy and Guidance. Requestors’ identities may be kept confidential, upon request.

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