FIF - MFO KMF MSME Syndicated Loan

Location:

Kazakhstan

Project number:

50164

Business sector:

Non-depository Credit (non bank)

Notice type:

Private

Environmental category:

FI

Target board 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

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