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Project number:


Business sector:

Financial institutions

Notice type:


Environmental category:


Approval date:

13 Mar 2001



PSD disclosed:

01 Mar 2001

Project Description

Establishment of a "greenfield" microfinance bank to provide financial services to micro and small enterprises (MSEs) in the Federal Republic of Yugoslavia, which was approved in 2001. The EBRD is now considering a capital increase, which will be reviewed by the Board of Directors on a no objection basis in July 2002.
The initial capitalisation and following capital increase will allow MFB to provide reliable access to financial services for MSEs throughout FR Yugoslavia, directly supporting private sector development. MFB has a strong demonstration effect on the sector, encouraging other Yugoslavian banks to enter this market segment.

Transition Impact

The project has a significant impact on the transition process. MFB provides continuous support to MSEs that would otherwise have little or no access to formal sector finance. MFB also supports the development of the financial sector by operating as a best practice institution committed to the principles of complete transparency and strong corporate governance.

The Client

Microfinance Bank of the Republic of Yugoslavia (MFB) is a newly established bank providing financial services to MSEs. The founding shareholders are: the EBRD (16.7 per cent), Commerzbank AG (16.7 per cent), Internationale Micro Investitionen AG (IMI - 16.7 per cent), Nederlandse Financierings Maatschappij Ontwikkelingslanden N.V. (FMO - 16.7 per cent), Kreditanstalt für Wiederaufbau (KfW - 16.7 per cent) and International Finance Corporation (IFC - 16.7 per cent).
MFB initially started operations in the cities of Belgrade, Novi-Sad and Nis, but has since launched branches in Subotica and Cacak. MFB has plans to expand further to other regions over the next 2 years. Since its establishment in April 2001, MFB has disbursed around 2,500 loans worth over US$ 21 million to micro and small enterprises.

EBRD Finance

The initial investment was made in April 2001: US$ 1 million (€1.01 million) equity investment to purchase 16.7 per cent of the share capital and a US$ 6 million (€6.06 million) senior loan for on-lending to MSEs.
The proposed capital increase would occur in August 2002: US$ 1 million (€1.01 million) equity investment. EBRD's share remains 16.7 per cent.

Project Cost

Total initial project cost was US$ 21.5 million (€21.7 million), of which the EBRD's share is US$ 7 million (€7.07 million - 32.5 per cent).
The total project cost after the capital increase is US$ 27.5 million (€27.7 million), of which the EBRD's share is US$ 7 million (€7.07 million - 25.5 per cent).

Environmental Impact

MFB carries out its operations in accordance with the EBRD's Environmental Procedures for Local Banks. In implementing these procedures, it requires all borrowers to comply, at a minimum, with national /local health, safety, environmental and public consultation requirements.

Technical Cooperation

Technical cooperation funding has been provided by FMO, KfW and the US Government. Internationale Project Consult GmbH (IPC) has been selected as technical partner.

Company Contact


Business opportunities

For business opportunities or procurement, contact the client company.

For state-sector projects, visit EBRD Procurement: Tel: +44 20 7338 6794

General enquiries

EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168

Public Information Policy (PIP)

The PIP 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. Please visit the Public Information Policy page below to find out how to request a Public Sector Board Report.
Text of the PIP

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