MICROCAPITAL BRIEF: European Fund for Southeast Europe (EFSE) Loans $19m to Komercijalna banka Beograd of Serbia for Housing Purchases, Improvements

Serbia’s Komercijalna banka Beograd, a bank based in Serbia, recently borrowed EUR 15 million (USD 19.2 million) under a senior loan agreement from the European Fund for Southeast Europe (EFSE), a Luxembourg-based, government-backed microfinance investment vehicle. The loan will be used for on-lending for the bank’s housing purchases and home improvements.

According to a statement attributed to Monica Beck, the Chairperson of the Board of EFSE, “Komercijalna banka is a very important EFSE partner when it comes to providing sustainable funding to micro and small enterprises and low-income households. We are therefore very pleased at this opportunity to broaden our commitment to the housing sector with this new loan” [1]. Dragan Santovac, Deputy President of the Executive Board of Komercijalna banka, added,  “Additional funding provides a solid basis for even more extensive and improved support of clients’ needs in what is perhaps the most important relationship with the bank and a very important personal decision. This credit arrangement will further improve our competitiveness and market position, which are already above average” [1].

Komercijalna banka Beograd, which is 40-percent owned by the government of Serbia and 25-percent owned by the European Bank, also has operations in Bosnia and Herzegovina as well as Montenegro. As of 2013, Komercijalna banka Beograd reports total assets of USD 4.62 billion. As of 2012, Komercijalna banka Beograd reports total assets of USD 3.77 billion, return on assets (ROA) of 1.51 percent and return on equity (ROE) of 9.44 percent. More recent financial information is unavailable. EFSE has an outstanding investment portfolio of EUR 774 million (USD 1 billion) as of June 2013. As of 2014, EFSE holds a microfinance label from Luxembourg Fund Labeling Agency (LuxFLAG), an NGO that certifies that social investment vehicles actually invest as advertised.

By Ananya Tiwari, Research Associate

About Komercijalna banka Beograd:

Established in 1970 in Serbia, Komercijalna banka Beograd also operates in Bosnia and Herzegovina through its subsidiary Komercijalna banka Banja Luka and in Montenegro through Komercijalna banka Budva. The government of Serbia owns 40 percent of the bank while UK-based multilateral institution European Bank for Reconstruction and Development (EBRD) owns 25 percent. As of 2013, Komercijalna banka Beograd reports total assets of USD 4.62 billion, 40 branch offices and 250 sub-branches in the three countries in which it operates.

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 1 billion). As of 2014, 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), http://www.efse.lu/Press-releases—Details—2014-10-14-EFSE-and-Komercijalna-Banka-broaden-partnership-with-a-new-senior-loan-agreement-for-housing-credit——_nav.52_siteid.134_entryid.568_dir._likecms.html

MicroCapital Story, July 12, 2014, “European Fund for Southeast Europe (EFSE) Loans $25m to Bank of Georgia for On-lending to Micro, Small Enterprises (MSEs),” https://www.microcapital.org/microcapital-brief-european-fund-for-southeast-europe-efse-loans-25m-to-bank-of-georgia-for-on-lending-to-micro-small-enterprises-mses/

MicroCapital Story, February 11, 2014, “European Fund for Southeast Europe (EFSE) Loans $4m to Komercijalna Banka Banja Luka of Bosnia and Herzegovina,” https://www.microcapital.org/microcapital-brief-european-fund-for-southeast-europe-efse-loans-4m-to-komercijalna-banka-banja-luka-of-bosnia-and-herzegovina/

MicroCapital Story, October 12, 2013, “European Fund for Southeast Europe (EFSE) to Loan $20m to Bank Republic of Georgia to Support Lending to Micro-, Small Enterprises (MSEs),” 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, September 19, 2013, “European Fund for Southeast Europe to Loan $6m to Inecobank to Support Micro- and Small Enterprises (MSEs),”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, June 15, 2012, “Green for Growth Fund Loans $30.6m to Partner Microcredit Foundation of Bosnia and Herzegovina, Komercijalna Banka Beograd of Serbia,” https://www.microcapital.org/microcapital-brief-green-for-growth-fund-loans-30-6m-to-partner-microcredit-foundation-of-bosnia-and-herzegovina-komercijalna-banka-beograd-of-serbia/

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

MicroCapital Universe Profile: Komercijalna banka Beograd https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Komercijalna+Banka

Do you know that MicroCapital publishes the MicroCapital Monitor newspaper each month? Find out more at https://www.microcapital.org/ p

Similar Posts: