A stand-by credit facility of US$ 10 million (ECU 8.7 million) to allow Rigas Komercbanka to increase funding to Latvian enterprises.
The project will enable RKB to increase medium-term lending using its own funding, to avoid maturity mismatches between RKB's assets and liabilities and to increase funding to Latvian medium-sized enterprises.
The project will make medium-term funds available to private firms in Latvia by transforming the maturity of local deposits. It will support a private sector bank and enable it to offer a full range of services. The project will also foster competition in the Latvian banking sector.
Rigas Komercbanka PLC (RKB) is a joint-stock company subject to Latvian law. At 30 June 1997, RKB was the third-largest bank in Latvia, with total assets of LVL 130 million (ECU 206 million) and equity of LVL 12.9 million (ECU 20 million). The EBRD is a 23 per cent shareholder in RKB.
US$ 10 million (ECU 8.7 million) stand-by revolving credit facility, which is for a period of five years, starting at date of signature. The loan will be priced at a floating rate US$ LIBOR plus a commercial margin. Each disbursement will be at least US$ 1 million.
US$ 10 million (ECU 8.7 million).
RKB will continue to carry out its operations in accordance with the EBRD's Environmental Procedures for Local Banks. In implementing these procedures, RKB will require its borrowers to comply, at a minimum, with national as well as local health and safety, environmental and public consultation requirements.
An ECU 800,000 two-year twinning programme has been approved. Grant funding has been requested for one half of this amount, with RKB paying the other half. The programme will cover asset and liability management, credit and marketing, information technology, branch management, financial planning and budgeting, strategic planning and human resources.
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