The European Fund for Southeast Europe (EFSE), a microfinance investment vehicle led by German development bank Kreditanstalt für Wiederaufbau (KfW), recently announced that it has provided an additional senior loan to QNB Finansbank, a Turkey-based commercial bank, in the amount of USD 20 million. QNB plans to use the funds to expand its agricultural lending in rural Turkey. In support of the transaction, EFSE is offering QNB “technical assistance, which includes training for agricultural banking, financial literacy workshops, seminars for local agricultural unions and cooperatives, and the development of reports on trends.”
Established in 1987, QNB was acquired by the government-owned Qatar National Bank in 2016. As of 2016, QNB reported total assets of TRY 101.5 billion (USD 27.9 billion), a customer deposit portfolio of TRY 52 billion (USD 14.3 billion) and a total loan portfolio of TRY 62.9 billion (USD 17.4 billion). Prior to the current loan, QNB has received loans totaling EUR 40 million (USD 43.1 million) from EFSE since the two became partners in 2014.
EFSE provides “long-term” funding in Southeast Europe and parts of Central Asia to financial institutions that serve micro- and small enterprises as well as private households. EFSE also operates a development facility through which it provides consulting and training services to these institutions. EFSE was established in 2005 by German development bank Kreditanstalt für Wiederaufbau (KfW) with the financial support of the EU’s European Commission and the German Federal Ministry for Economic Cooperation and Development, which is also known by its German acronym BMZ. The fund 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. EFSE operates in 16 countries: Albania, Armenia, Azerbaijan, Belarus, Bosnia and Herzegovina, Bulgaria, Croatia, Georgia, Kosovo, Moldova, Montenegro, Romania, Serbia, Ukraine, Turkey and the Former Yugoslav Republic of Macedonia. As of 2017, EFSE holds a microfinance label from Luxembourg Fund Labeling Agency (LuxFLAG), an NGO that certifies that social investment vehicles actually invest as advertised. As of 2016, EFSE reported a gross loan portfolio of EUR 957 million (approximately USD 1.0 billion).
By Phoebe Rorke, Research Associate
Sources and Additional Resources
European Fund for Southeast Europe:
EFSE, QNB Finansbank increase support for agribusiness in rural Turkey
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