MICROCAPITAL BRIEF: European Fund for Southeast Europe (EFSE) Loans $11m to UniCredit Bank Serbia for On-Lending to Individuals for Home Improvement, Housing Finance

The European Fund for Southeast Europe (EFSE), a Luxembourg-based microfinance investment vehicle (MIV), recently announced that it will loan EUR 10 million (USD 10.8 million) to UniCredit Bank Serbia, the Belgrade-based subsidiary of the Italian commercial banking firm UniCredit Group. UniCredit Bank Serbia plans to on-lend the funds to private households with the aim of contributing to home improvement efforts. The funding will be also available for housing loans for low-income individuals in either urban or rural parts of the country.

Monika Beck, the chairperson of the board of EFSE, said that “UniCredit Bank Serbia has continuously proved effective at on-lending not only in major cities but also in other areas of the country”[1]. Claudio Cesario, the chief executive officer of UniCredit Bank Serbia, added that “we are pleased to be in the position to provide extended financing for residential market thanks to our long-term partnership with the EFSE. This agreement will help us to financially support citizens to buy their own living space […]”[1].

As MicroCapital reported in January 2015, EFSE loaned EUR 10 million (USD 10.8 million) to UniCredit Bank Serbia at that time in order to fund similar housing projects. As of 2014, EFSE reported a gross loan portfolio of EUR 940.5 million (approximately USD 1 billion). As of September 30, 2015, UniCredit Bank Serbia reported total assets of RSD 308 billion (USD 2.7 billion). UniCredit Group serves 17 countries in Europe.

By Alíz Crowley, Research Associate

About UniCredit Bank Serbia

UniCredit Bank Serbia is a member of UniCredit Group, an Italy-based financial institution. UniCredit Group has 7,100 branches in 17 countries in Europe and reported total assets of EUR 874 billion (USD 940 billion) as of September 30, 2015. As of the same date, UniCredit Bank Serbia reported total assets of RSD 308 billion (USD 2.7 billion).

About European Fund for Southeast Europe (EFSE)

The Luxembourg-based European Fund for Southeast Europe (EFSE) focuses on the development of local financial sectors in Southeast Europe and parts of Central Asia by providing “long-term” funding for micro- and small enterprises as well as private households via partner retail institutions. EFSE also operates the EFSE Development Facility, which provides technical assistance, consulting and training services to support capacity building within these partner institutions. EFSE was established in 2005 by German Development Bank Kreditanstalt für Wiederaufbau (KfW), with the financial support of the German Federal Ministry for Economic Cooperation and Development (which is also known by its German acronym BMZ) and the EU’s European Commission. 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 2014, EFSE reported a gross loan portfolio of EUR 940.5 million (approximately USD 1 billion). As of 2015, 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, News, EFSE provides EUR 10 million loan to UniCredit for broadening access to housing and home improvement finance in Serbia

[2] UniCredit Bank Serbia, About Us

MicroCapital Universe Profile: UniCredit Bank Serbia

MicroCapital Universe Profile: European Fund for Southeast Europe (EFSE)

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