MICROCAPITAL BRIEF: European Fund for Southeast Europe (EFSE), Tbilisi Business Center (TBC) Bank Georgia Partner to Fund Micro-, Small Enterprises (MSEs); Agricultural Producers

The European Fund for Southeast Europe (EFSE), a Luxembourg-based microfinance investment vehicle (MIV), recently announced that it will disburse a subordinated loan of USD 15 million to Tbilisi Business Center (TBC) Bank, a Tbilisi, Georgia-based commercial bank, to support access to financing for micro- and small enterprises (MSEs) as well as agricultural producers in rural areas of Georgia. TBC will be EFSE’s fifth partner lending institution in Georgia [1].

Monika Beck, the chairperson of the board of EFSE, said that with TBC’s “strong rural presence, [the organization] will make an important contribution to providing additional financing to MSEs in Georgia” [1]. The Chief Executive Officer of TBC Bank, Vakhtang Butskhrikidze, stated that “This facility will further strengthen TBC Bank’s tier-two capital and help to enhance our position in the market by expanding lending activities throughout the entire country” [1].

As of September 2015, TBC Bank reported total assets of GEL 6.94 billion (USD 2.9 million), with 19.0 percent return on average equity (ROAE) and 3.3 percent return on average assets (ROAA). Its customer deposits totaled GEL 4.29 billion (USD 1.8 million), and its gross loan portfolio amounted to GEL 4.56 billion (USD 1.9 million). As of 2014, EFSE reported a gross loan portfolio of EUR 940.5 million (approximately USD 1 billion).

By Meredith Steih, Research Associate

About Tbilisi Business Center (TBC) Bank Georgia
Founded in 1992, TBC Bank is a commercial institution based in Tbilisi, Georgia. As of September 2015, it reported total assets of GEL 6.94 billion (USD 2.9 million), with 19.0 percent return on average equity (ROAE) and 3.3 percent return on average assets (ROAA). Its customer deposits totaled GEL 4.29 billion (USD 1.8 million), and its gross loan portfolio amounted to GEL 4.56 billion (USD 1.9 million). As of September 2015, micro-, small and medium-enterprise lending comprised 11 percent of TBC Bank’s total portfolio.

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. EFSE provides “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 supporting capacity building within these partner institutions. EFSE was established in 2005 by Germany’s 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 and Turkey, 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 and TBC Bank enter partnership to support MSEs in Georgia”http://www.efse.lu/news-events/news/detail/efse-and-tbc-bank-enter-partnership-to-support-mses-in-georgia/

[2] TBC Bank, “Financial Highlights” http://ir.tbcbank.ge/?site-lang=en&site-path=information/financial_highlights/&site-session=41eeefd75ea1a29a79be7ea58a1e6d99

MicroCapital Universe Profile: TBC Bank Georgia

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

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