MICROCAPITAL BRIEF: Belgazprombank (BGPB) of Belarus to Receive $41m Syndicated Loan from European Bank for Reconstruction and Development (EBRD), European Fund for Southeast Europe (EFSE)

Belgazprombank (BGPB), a Belarus-based commercial bank owned by Gazprom of Russia, Gazprombank of Russia, Beltransgaz of Belarus and the Belorussian government, recently entered into an agreement with the European Bank for Reconstruction and Development (EBRD), a UK-based multilateral financial institution, and the European Fund for Southeast Europe (EFSE), a Luxembourg-based microfinance investment vehicle, to accept a five-year, syndicated loan of  EUR 30 million (USD 41.4 million). Of this amount, EFSE will disburse EUR 20 million (USD 27.6 million) while EBRD will provide the remaining EUR 10 million (USD 13.8 million). BGPB intends to use the funds for on-lending to micro-, small and medium-sized enterprises (MSMEs).

As of January 01, 2013, BGPB reported total assets of BYR 10.7 trillion (USD 1.1 billion), return on equity of 23.6 percent and return on assets of 3.8 percent. In 2013, EBRD invested EUR 8.5 billion (USD 11.4 billion) in 392 projects across 34 countries in Central Asia, Eastern Europe and North Africa. As of 2013, EFSE has an outstanding investment portfolio of EUR 774 million (USD 1 billion) in Southerneastern Europe and Central  Asia.

By Tejas Jain, Research Associate

About Belorusian-Russian Belgazprombank (BGPB):

The Belorusian-Russian Belgazprombank (BGPB) Joint Stock Company, headquartered in Minsk, Belarus, was established in 1990. It is jointly owned by owned by Gazprom of Russia, Gazprombank of Russia, Beltransgaz of Belarus and the Belorussian government. The company’s services include deposits, loans, payment transfers, currency exchanges and providing precious metal investment services to its corporate customers and individuals. The bank is involved in the settlements of gas supplies to the Republic of Belarus as well as in settlements for the transit of Russian gas to Europe. As of January 01, 2013, BGPB reported total assets of BYR 10.7 trillion (USD 1.1 billion), return on equity of 23.6 percent and return on assets of 3.8 percent. As of 2013, it had eight offices in Belarus.

About European Bank for Reconstruction and Development (EBRD):

The European Bank for Reconstruction and Development (EBRD) is a multilateral institution headquartered in London, United Kingdom. The bank began operations in 1991 upon the agreement of 40 countries, and it is owned by 61 countries as well as the European Investment Bank and the European Union as of 2012. It aims to finance operations that are both commercially viable and assist development in 29 countries in Eastern Europe, Central Asia and North Africa. It does this by providing loans, debt securities, equity investments, guarantees and technical assistance to micro- and small businesses via commercial banks and non-bank microfinance institutions (MFIs). In 2013, EBRD invested EUR 8.5 billion (USD 11.4 billion) in 392 projects across 34 countries in Central Asia, Eastern Europe and North Africa.

About European Fund for Southeast Europe (EFSE):

The European Fund for Southeast Europe (EFSE) is a Luxembourg-based microfinance investment vehicle that was established in 2005 by Kreditanstalt für Wiederaufbau Entwicklungsbank (KfW), a German development bank, with financial support from the German Federal Ministry for Economic Cooperation and Development (Bundesministerium für wirtschaftliche Zusammenarbeit und Entwicklung) and the European Commission of the EU. EFSE seeks to aid economic development in southeastern Europe and parts of central Asia by supporting the provision of financial services to low-income households and micro- and small enterprises via local financial institutions. EFSE is privately managed, with Oppenheim Asset Management Services of Luxembourg acting as fund manager and Finance in Motion GmbH of Germany acting as fund advisor. As of June 2013, EFSE has an investment portfolio of EUR 774 million (USD 1 billion). As of 2013, EFSE holds a microfinance label from Luxembourg Fund Labeling Agency (LuxFLAG), an NGO that certifies that social investment vehicles actually invest as advertised.

Sources and Additional Resources:

EBRD News, “EBRD revives Belarus syndicated loan market,”
http://www.ebrd.com/pages/news/press/2014/140227b.shtml

MicroCapital Story, January 29, 2014, “Kompanion Financial Group of Kyrgyzstan Receives Syndicated Loan of $12m from European Bank for Reconstruction and Development (EBRD), Nederlandse Financierings-Maatschappijvoor Ontwikkelingslanden (FMO),”
https://www.microcapital.org/microcapital-brief-kompanion-financial-group-of-kyrgyzstan-receives-syndicated-loan-of-12m-from-european-bank-for-reconstruction-and-development-ebrd-nederlandse-financierings-maatschappijvoor-on/

MicroCapital Story, January 25, 2014, “European Bank for Reconstruction and Development (EBRD) Invests $60m in Banque Marocaine du Commerce Extérieur’s Eurobond Issue for Micro-, Small, Medium-Sized Enterprises in Morocco,”
https://www.microcapital.org/microcapital-brief-european-bank-for-reconstruction-and-development-ebrd-invests-60m-in-banque-marocaine-du-commerce-exterieurs-eurobond-issue-for-micro-small-medium-sized-enterprises/

MicroCapital Story, September 9, 2011, “European Bank for Reconstruction and Development (EBRD) to Loan $4m in Local Currency to Microfinance Institution (MFI) Kompanion of the Kyrgyz Republic,”
https://www.microcapital.org/microcapital-brief-europrean-bank-for-reconstruction-and-development-ebrd-to-loan-4m-in-local-currency-to-microfinance-institution-mfi-kompanion-of-the-kyrgyz-republic/

MicroCapital Universe Profile, Belorusian-Russian Belgazprombank,
https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Belorussian-Russian+Belgazprombank+Joint+Stock

MicroCapital Universe Profile, European Bank for Reconstruction and Development (EBRD),
https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=European+Bank+for+Reconstruction+and+Development+%28EBRD%29

MicroCapital Universe Profile, European Fund for Southeast Europe (EFSE),
https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=European+Fund+for+Southeast+Europe+%28EFSE%29

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