MICROCAPITAL BRIEF: European Fund for Southeast Europe (EFSE) Loans $31m to Komercijalna banka Beograd of Serbia, Microfinance Institution Patria Credit of Romania

The European Fund for Southeast Europe (EFSE), a Luxembourg-based microfinance investment vehicle (MIV) backed by multiple governments, has loaned EUR 20 million (USD 27.6 million) to Komercijalna banka Beograd, a bank based in Serbia, and EUR 2.5 million (USD 3.4 million) loan to Patria Credit, a non-banking microfinance institution (MFI) in Romania that seeks to provide increased financial access to micro- and small enterprises [1].

Komercijalna banka Beograd is 40-percent owned by the government of Serbia and also has operations in Bosnia and Herzegovina and Montenegro. 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. As of the same period, Patria Credit reported total assets of USD 82 million, a gross loan portfolio of USD 70.9 million and approximately 12,200 borrowers. Patria Credit does not accept deposits. EFSE has an outstanding investment portfolio of EUR 774 million (USD 1 billion) as of June 2013. 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.

By Nisha Koul, 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 2012, the bank reported total assets of USD 3.77 billion, return on assets (ROA) of 1.51 percent, return on equity (ROE) of 9.44 percent, 40 branch offices and 250 sub-branches in the three countries in which it operates.

About Patria Credit: Patria Credit which was founded in 1996 in Romania, is a non-banking microfinance institution (MFI) that seeks to provide financial services to micro- and small enterprises, agricultural producers and individual entrepreneurs through its 43 regional units. As of 2012, Patria Credit reported total assets of USD 82 million, a gross loan portfolio of USD 70.9 million and approximately 12,200 borrowers. Patria Credit does not accept deposits. Patria Credit was formerly known as Capa Finance.

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 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] Information submitted by Finance in Motion to MicroCapital, October 2013.

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, October 30, 2012, “International Finance Corporation Aims to Boost Entrepreneurship in Romania with $10m Loan to Patria Credit,” https://www.microcapital.org/microcapital-brief-international-finance-corporation-aims-to-boost-entrepreneurship-in-romania-with-10m-loan-to-patria-credit/

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

MicroCapital Universe Profile, Patria Credit, https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Patria+Credit+SA

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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