The European Bank for Reconstruction and Development (EBRD), a UK-based multilateral institution, recently approved a EUR 80 million (USD 106 million) loan to Banca Comerciala Romania (BCR), a member of Austria-based financial service provider Erste Group Bank AG, for on-lending to small and medium-sized enterprises (SMEs) in Romania. BCR plans to disburse the money in euros or Romanian leu via “investment loans, revolving credit facilities, loans for working capital, financing for leasing, factoring and other appropriate financing instruments, with a special focus on the agriculture and agribusiness sectors”.
The loan is part of a joint Action Plan for Growth in Central and South Eastern Europe launched in November 2012 that involves disbursing EUR 30 billion (USD 40 billion) over a two-year period. The Action Plan was developed by EBRD, the US-based World Bank Group and the European Investment Bank Group as a response to the “impact of eurozone problems on the economies of emerging Europe.”
In 2012, BCR reported total assets of EUR 17 billion (USD 22.6 billion). As of March 2013, Erste Group reports total assets of EUR 212 trillion (USD 283 trillion). In the same year, EBRD invested EUR 8.7 billion (USD 11.4 billion) in 388 projects in 31 countries.
By Charlotte Newman, Research Associate
About the European Bank for Reconstruction and Development (EBRD)
The European Bank for Reconstruction and Development (EBRD) is a multilateral institution headquartered in London. The bank began operations in 1991 upon the agreement of 40 countries and is now owned by 61 countries as well as the European Investment Bank and the European Union. 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 2012, EBRD invested EUR 8.7 billion (USD 11.4 billion) in 388 projects in 31 countries.
Sources and Additional Resources:
EBRD Press Release: “EBRD Steps Up Support for Romanian SMEs,” http://www.ebrd.com/pages/news/press/2013/130617.shtml
EBRD Press Release: “New Joint IFI Action Plan for Growth in Central and South Eastern Europe,” http://www.ebrd.com/pages/news/features/joint-ifi-action-plan.shtml
MicroCapital.org story, June 17, 2013, “MICROCAPITAL BRIEF: European Fund for Southeast Europe (EFSE), European Bank for Reconstruction and Development (EBRD) Loan $4m to Mikrokreditna Fondacija Mi-Bospo of Bosnia and Herzegovina,” http://www.microcapital.org/microcapital-brief-european-fund-for-southeast-europe-efse-european-bank-for-reconstruction-and-development-ebrd-loan-4m-to-mikrokreditna-fondacija-mi-bospo-of-bosnia-and-herzegovina/
MicroCapital.org story, November 21, 2012, “MICROCAPITAL BRIEF: Part of $38b Commitment from European Investment Bank, World Bank, European Bank for Reconstruction and Development to Support SMEs,” http://www.microcapital.org/microcapital-brief-part-of-38b-commitment-from-european-investment-bank-world-bank-european-bank-for-reconstruction-and-development-to-support-smes/
MicroCapital Universe Profile: European Bank for Reconstruction and Development (EBRD)
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