MICROCAPITAL BRIEF: Green for Growth Fund, Southeast Europe (GGF) Lends $5m to Muganbank of Azerbaijan for On-Lending to Micro-, Small and Medium-Sized Enterprises (MSMEs) for Energy Efficiency Projects

The Green for Growth Fund, Southeast Europe (GGF), a Germany-based fund that invests in energy efficiency (EE) and renewable energy sources, recently disbursed a senior loan totaling USD 5 million to Muganbank, a financial institution that offers retail and corporate banking services in Azerbaijan, to on-lend to finance energy-efficient measures to be taken by households and micro-, small and medium-sized enterprises (MSMEs). GGF and Muganbank anticipate that these loans will result in an energy savings of 8,700 megawatts per year.

According to Elmir Hasanov, the Chairman of the Board of Muganbank, “The GGF credit facility will enable us to offer EE loans to our MSME and retail customers to support their investments in EE measures. We will also be able to count on capacity-building support to drive our EE lending operations forward, and that tells us that we truly have an ideal partner in the GGF.”

Muganbank reported total assets of AZN 334 million (USD 425 million), loans to customers of AZN 218 million (USD 278 million) and liabilities to customers of AZN 152 million (USD 194 million) as of December 31, 2013 As of December 2013 the bank had 152, 235 total customer accounts. As of 2014, GGF operates in 13 countries: Albania, Armenia, Azerbaijan, Bosnia and Herzegovina, Croatia, Former Yugoslav Republic of Macedonia, Georgia, Kosovo, Moldova, Montenegro, Serbia, Turkey and Ukraine. GGF reported total assets of EUR 242 million (USD 326 million), a loan portfolio of EUR 170 million (USD 229 million) and profits EUR 430,000 (USD 579,000) as of December 31, 2013.

By Ananya Tiwari, Research Associate

About Green for Growth Fund, Southeast Europe (GGF)
Luxembourg-based Green for Growth Fund, Southeast Europe (GGF) focuses on expanding the use of renewable energy sources and enhancing energy efficiency in southeastern Europe. It does this by financing and refinancing energy-efficiency initiatives and investing in small to medium-scale renewable energy projects. Furthermore, GGF offers technical support and funding to local financial institutions. GGF was established in 2009 by Germany’s Kreditanstalt für Wiederaufbau (KfW) and the Luxembourg-based European Investment Bank (EIB) with the financial support of the following organizations: EU’s European Commission, the German Federal Ministry for Economic Cooperation and Development (also known by its German acronym BMZ), and the European Bank for Reconstruction and Development (EBRD). As of 2014, GGF operates in 13 countries: Albania, Armenia, Azerbaijan, Bosnia and Herzegovina, Croatia, Former Yugoslav Republic of Macedonia, Georgia, Kosovo, Moldova, Montenegro, Serbia, Turkey and Ukraine. GGF reported total assets of EUR 242 million (USD 326 million), a loan portfolio of EUR 170 million (USD 229 million) and profits EUR 430,000 (USD 579,000) as of December 31, 2013.

About Muganbank Open Joint Stock Company
Headquartered in Baku, Muganbank Open Joint Stock Company (OJSC) was established in 1992. The bank offers a range of retail and corporate banking services in Azerbaijan. As of December 31, 2013, Muganbank reported total assets of AZN 334 million (USD 425 million), loans to customers of AZN 218 million (USD 278 million) and liabilities to customers of AZN 152 million (USD 194 million). As of December 2013 the bank had 152, 235 total customer accounts,

Sources and Additional Resources

[1] GGF Press Release, http://www.ggf.lu/Press-Details—2014-10-30-GGF-AND-MUGANBANK-PROMOTE-INVESTMENT-IN-ENERGY-EFFICIENCY-MEASURES-IN-AZERBAIJAN——_site.site..html_dir._siteid.93_nav.-1_entryid.208_likecms.html
MicroCapital, October 14, 2014, European Bank for Reconstruction and Development (EBRD) Loans $3m to Muganbank of Azerbaijan for On-Lending to Corporates, Individuals for Energy Efficiency, Renewable Energy Projects, https://www.microcapital.org/microcapital-brief-european-bank-for-reconstruction-and-development-ebrd-loans-3m-to-muganbank-of-azerbaijan-for-on-lending-to-corporates-individuals-for-energy-efficiency-renewable-energy-proje/

MicroCapital, September 24, 2014, Green for Growth Fund, Southeast Europe (GGF) Lends $2m to Microinvest of Moldova for On-Lending to Micro-, Small Enterprises (MSEs), https://www.microcapital.org/microcapital-brief-green-for-growth-fund-southeast-europe-ggf-lends-2m-to-microinvest-of-moldova-for-on-lending-to-micro-small-enterprises-mses/

MicroCapital, August 22, 2014, Green for Growth Fund, Southeast Europe (GGF) Lends $20m to Yapi Kredi Leasing of Turkey to Support Use of Energy-Efficient Equipment, https://www.microcapital.org/microcapital-brief-green-for-growth-fund-southeast-europe-ggf-lends-20m-to-yapi-kredi-leasing-of-turkey-to-support-use-of-energy-efficient-equipment/

MicroCapital Universe Profile: Green for Growth Fund, Southeast Europe (GGF), https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Green+for+Growth+Fund

MicroCapital Universe Profile: Muganbank Open Joint Stock Company (OJSC), https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Muganbank+Open+Joint+Stock+Company+%28OJSC%29

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