XacBank Syndicated Loan

Location:

Mongolia

Project number:

43542

Business sector:

Financial institutions

Notice type:

Private

Environmental category:

FI

Approval date:

29 May 2012

Status:

Complete

PSD disclosed:

27 Apr 2012

 

Translated version of this PSD: Mongolian

Project Description

The EBRD is considering a Senior A/B loan to XacBank in the amount of up to USD 38m, of which the A loan will be up to USD 10m, while another USD 5m is expected to be co-financed by TaiwanICDF and the remaining B loan of up to USD 23m will be syndicated to financial institutions on best efforts basis. The strong business expansion of the Mongolian economy and its corporate sector require an additional source of medium to longer term funding which will be provided by the proposed debt package.

Transition Impact

The project will provide longer term lending to micro, small and medium-sized enterprises (MSMEs) at a time when the availability of medium- and long-term financing to these companies in Mongolia remains constrained. The participation of commercial lenders in the syndicate would demonstrate new ways of financing activities to other Mongolian financial institutions. The project will also facilitate improvement of XacBank's FX lending procedures for stress testing and disclosure of risks associated with such loans, thus demonstrating higher standards of business conduct to other Mongolian banks.

The Client

XacBank is the fourth largest bank in Mongolia. It is a leading microfinance provider with 92 branches and service outlets across the country. In recent years, the bank has leveraged its extensive microfinance experience to broaden the bank’s presence in the SME business segment, in line with economic development in Mongolia.

EBRD Finance

Up to US$ 10million.

Project Cost

Up to US$ 38 million.

Environmental Impact

Categorised FI. XacBank is an existing client of the Bank and has adopted an Environmental Policy and Environmental and Social Procedures, which satisfy requirements of PR 2 and 9.

Technical Cooperation

XacBank is currently benefiting from technical assistance to support the bank’s plans to expand its outreach to SME and corporate clients. The funding is provided by the Korean Government.

Previously, between 2008 and 2010, TC was provided to the bank to support its MSME lending activities. The funding was provided by the EBRD Early Transition Country Fund and the EBRD Shareholder Special Fund.

No new technical cooperation is envisioned for this project.

Company Contact

XacBank HQ Bldg, Ulaanbaatar-14200, Post Branch 20A, PO Box-721, MONGOLIA
E-mail: info@xacbank.mn
Website: www.xacbank.mn
Tel: +976 11 318185
Fax: +976 11 328701

 

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

EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com

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

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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