MICROCAPITAL BRIEF: European Investment Bank (EIB) to Loan $31m to AccessBank Azerbaijan for On-lending to Small, Medium-Sized Enterprises (SMEs)

The Luxembourg-based European Investment Bank (EIB), the long-term lending bank of the European Union (EU), recently announced that it is extending an intermediated senior loan totaling EUR 25 million (USD 31 million) to AccessBank Azerbaijan, a microfinance bank (MFB) in Azerbaijan, for on-lending to small and medium-sized enterprises (SMEs) in the country. According to Micheal Hoffman, Chairman of the Management Board at AccessBank, the funds will be used to expand the bank’s SME lending.

Wilhelm Molterer, Vice-President of EIB stated that this first-ever EIB loan extended in Azerbaijan is designed to promote private sector development by improving the access of SMEs to long-term finance. It is intended to strengthen the SME sector and contribute to implementation of the Azerbaijani government’s priorities to further diversify and modernise the country’s economy.

As of 2014, AccessBank reports deposits of USD 279 million from 332,000 depositors, a gross loan portfolio of USD 664 million outstanding to 167,000 active borrowers and total assets of USD 834 million. AccessBank is associated with Germany’s Access Microfinance Holding, which also holds stakes in MFBs in Liberia, Madagascar, Nigeria, Tajikistan and Tanzania. The total annual lending portfolio of EIB was EUR 71.7 billion (USD 95.8 billion) as of 2013.

By Ananya Tiwari, Research Associate

About AccessBank Azerbaijan
AccessBank Azerbaijan was founded in 2002 to provide credit and financial services to Azerbaijan’s small businesses and low-income families. AccessBank is owned by the following six shareholders: the Black Sea Trade and Development Bank, a Greece-based financial institution (20% ownership); the European Bank for Reconstruction and Development, a London-based multilateral financial institution (20% ownership); the International Finance Corporation, the World Bank Group’s private-investment arm (20% ownership); Kreditanstalt für Wiederaufbau (KfW), a German development bank (20% ownership); Access Microfinance Holding, an investor in microfinance (16.5% ownership) and LFS Financial Systems, a German consulting company that manages Access Microfinance Holding (3.5% ownership). As of 2014, AccessBank reported to the US-based nonprofit Microfinance Information Exchange (MIX) deposits of USD 279 million in 332,000 accounts, a gross loan portfolio of USD 664 million outstanding to 167,000 active borrowers and total assets of USD 834 million. As of 2013, AccessBank reported return on assets of 3.8 percent and return on equity of 22.3 percent.

About European Investment Bank (EIB)
The European Investment Bank (EIB) was created in 1958 and now serves as the long-term The European Investment Bank (EIB) was created in 1958 and serves as the long-term lending bank of the European Union as of 2014. In addition to supporting projects in EU member states, its main priorities include financing investments in likely future member states and EU partner countries, principally in the area of small and medium-sized enterprises. According to its website, “the EIB operates on a non-profit maximizing basis and lends at close to the cost of borrowing.” The total annual lending portfolio of EIB was EUR 71.7 billion (USD 95.8 billion) as of 2013.

Sources and Additional Resources

[1] EIB Press Release, http://www.eib.org/infocentre/press/releases/all/2014/2014-249-eib-launches-operations-in-azerbaijan-support-to-smes-through-accessbank.htm

MicroCapital, November 12, 2014, MICROCAPITAL BRIEF: Symbiotics Issues Bonds Totaling $9.3m to Prasac of Cambodia, AccessBank Azerbaijan, https://www.microcapital.org/microcapital-brief-symbiotics-issues-bonds-totaling-9-3m-to-prasac-of-cambodia-accessbank-azerbaijan/ 

MicroCapital October 15, 2014, MICROCAPITAL BRIEF: African Development Bank (AfDB), Asian Development Bank (ADB), European Bank for Reconstruction and Development (EBRD), European Investment Bank (EIB), Inter-American Development Bank (IDB), World Bank Group (WBG) Issues Joint Statement on Climate Finance, https://www.microcapital.org/microcapital-brief-african-development-bank-afdb-asian-development-bank-adb-european-bank-for-reconstruction-and-development-ebrd-european-investment-bank-eib-inter-american-development-b/

MicroCapital, July 25, 2014, MICROCAPITAL BRIEF: AccessBank Azerbaijan Receives $15m Loan from Green for Growth Fund for Financing Energy-Efficient Projects, https://www.microcapital.org/microcapital-brief-accessbank-azerbaijan-receives-15m-loan-from-green-for-growth-fund-for-financing-energy-efficient-projects/

MicroCapital, July 26 2013, MICROCAPITAL BRIEF: European Investment Bank (EIB) Loans $92m to National Microfinance Bank (NMB) of Tanzania for Micro-, Small, Medium-sized Enterprises, https://www.microcapital.org/microcapital-brief-european-investment-bank-eib-loans-92m-to-national-microfinance-bank-nmb-of-tanzania-for-micro-small-medium-sized-enterprises/

MicroCapital Universe Profile: AccessBank Azerbaijan, https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Access+Bank%2C+Azerbaijan

MicroCapital Universe Profile: European Investment Bank (EIB), https://www.microcapital.org/microfinanceuniverse/tikiindex.php?page=European+Investment+Bank+%28EIB%29

MicroCapital Universe Profile: Access Microfinance Holding AG (AccessHolding), https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Access+Microfinance+Holding+AG+%28AccessHolding%29

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