MICROCAPITAL BRIEF: European Bank for Reconstruction and Development (EBRD) Considers $22m Credit to Belinvestbank of Belarus for On-Lending to Micro-, Small and Medium-sized Enterprises (MSMEs)

The European Bank for Reconstruction and Development (EBRD), a multilateral investment institution headquartered in London, is considering extending a credit line of EUR 20 million (USD 22 million) to Belinvestbank (BIB), a state-owned bank in Belarus. Funds drawn under the credit line would be on-lent to micro-, small and medium-sized enterprises (MSMEs). The funding would be paired with a loan of EUR 30 million (USD 33 million) for a trade facilitation program.

The proposed credit line would be considered “pre-privatization financing”[1], as it is anticipated that the funding would help attract private investments into Belinvetbank. In addition, EBRD hopes the project would enhance, “small and medium private enterprise access to longer term credit resources and facilitate international trade involving Belarus companies”[1].

During 2014, EBRD invested EUR 8.9 billion (USD 10.1 billion) in 377 projects in 34 countries and reported total members’ equity of EUR 14.2 billion (USD 16.1 billion). In Belarus, EBRD focuses on the private and municipal sectors. In September, BIB reported approximately BYR 29 trillion (USD 1.9 billion) in total assets, including approximately BYR 16 trillion (USD 1 billion) in loans to customers. Further financial information on the organization is unavailable.

By Mathew Cerf, Research Associate

About European Bank for Reconstruction and Development (EBRD)

The European Bank for Reconstruction and Development (EBRD) is a multilateral institution headquartered in London, England. The bank began operations in 1991 upon the agreement of 40 countries, and is owned by 64 countries as well as the European Investment Bank and the European Union as of 2014. It aims to finance operations that are both commercially viable and assist development 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). EBRD invested EUR 8.9 billion (USD 10.1 billion) in 377 projects in 34 countries during 2014, and as of December of that year it reported total members’ equity of EUR 14.2 billion (USD 16.1 billion).

About Belinvestbank (BIB)

Belinvestbank (BIB) was founded in 2001 through the merger of Belbusinessbank Joint Stock Company and Belarus Bank of Development. BIB acts as the investment and credit agency of the government of Belarus as well as the domestic agent for development programs funded by the World Bank. The organization is registered by the National Bank of the Republic of Belarus and its objective includes furthering cooperation with foreign partners. As of September 2014, BIB reported approximately BYR 29 trillion (USD 1.9 billion) in total assets, including approximately BYR 16 trillion (USD 1 billion) in loans to customers. Further financial information on the organization is unavailable.

Sources and Additional Resources

[1] European Bank for Reconstruction and Development, “Belinvestbank MSME and TFP pre-privatization financing”, July 3 2015,http://www.ebrd.com/cs/ContentServer?c=Content&cid=1395245295801&d=&pagename=EBRD%2FContent%2FContentLayout

[2] Belinvestbank, “Summer Interim Consolidated Financial Statements”, September 2014, http://www.belinvestbank.by/upload/IFRS/Summary_interim_consolidated_financial_statements_in_accordance_with_IFRS_for_the_9_months_ended_30_September_2014.pdf

[3] MicroCapital Universe Profile, “European Bank for Reconstruction and Development”, http://microcapital.org/microfinanceuniverse/tiki-index.php?page=European+Bank+for+Reconstruction+and+Development+%28EBRD%29

[4] MicroCapital Universe Profile, “Belinvestbank (BIB)”, http://microcapital.org/microfinanceuniverse/tiki-index.php?page=Belinvestbank+%28BIB%29

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