MICROCAPITAL BRIEF: European Fund for Southeast Europe (EFSE) Lends $10m to Megabank of Ukraine to Support Agricultural Lending

The European Fund for Southeast Europe (EFSE), a Luxembourg-based microfinance investment vehicle, recently issued a senior loan of USD 10 million to Megabank, a financial service provider in Ukraine, to increase its agricultural lending and strengthen its position in the market [1]. Further information on the deal is not yet available.

Twenty percent of Megabank’s loan portfolio is designated for agricultural lending.

As of June 2013, EFSE has an investment portfolio of EUR 774 million (USD 1 billion). As of 2012, Megabank has assets of UAH 3.5 billion (USD 440 million), a loan and investment portfolio of UAH 2.7 billion (USD 340 million) and capital of UAH 729 million (USD 91.7 million).

By Megan McGowan, Research Associate

About Megabank:

Megabank is a Ukraine-based financial institution that offers financial services to corporate and private clients. The regional network has 195 branches in 25 regions of Ukraine. The bank provides services to 360,000 clients, including 85,000 pensioners and social aid recipients. As of 2012, the bank has assets of UAH 3.5 billion (USD 440 million), a loan and investment portfolio of UAH 2.7 billion (USD 340 million) and capital of UAH 729 million (USD 91.7 million). Megabank does not report to the US-based nonprofit data provider Microfinance Information Exchange (MIX).

About European Fund for Southeast Europe (EFSE):

The European Fund for Southeast Europe (EFSE) 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 1000 million). 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:

[1] European Fund for Southeast Europe: “EFSE Issues USD 10 million Loan to MegaBank in Ukraine,” http://www.efse.lu/media/pdfs/press-releases/2013/2013-10-megabank.pdf

MicroCapital Story, “European Fund for Southeast Europe (EFSE) to Loan $20m to Bank Republic of Georgia to Support Lending to Micro-, Small Enterprises (MSEs),” October 12, 2013, https://www.microcapital.org/microcapital-brief-european-fund-for-southeast-europe-efse-to-loan-20m-to-bank-republic-of-georgia-to-support-lending-to-micro-small-enterprises-mses/

MicroCapital Story, “European Fund for Southeast Europe to Loan $6m to Inecobank to Support Micro- and Small Enterprises (MSEs),” September 19, 2013, https://www.microcapital.org/microcapital-brief-european-fund-for-southeast-europe-to-loan-6m-to-inecobank-to-support-micro-and-small-enterprises-mses/

MicroCapital Story, “European Fund for Southeast Europe (EFSE) Lends $23m to Inecobank of Armenia, Megabank of Ukraine, Partner MikroKreditna Fondacija Tuzla of Bosnia and Herzegovina,” May 11, 2012, https://www.microcapital.org/microcapital-brief-european-fund-for-southeast-europe-efse-lends-23m-to-ineco-bank-of-armenia-megabank-of-ukraine-partner-mikrokreditna-fondacija-tuzla-of-bosnia-and-herzegovina/

MicroCapital Universe Profile: Megabank, https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Megabank

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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