MICROCAPITAL BRIEF: International Finance Corporation (IFC) Loans $20m to Agricultural Cooperative Bank of Armenia (ACBA)-Credit Agricole Bank to Increase Lending to Micro-, Small and Medium-Sized Enterprises (MSMEs)

The International Finance Corporation (IFC), the private-investment arm of the World Bank Group, recently loaned USD 20 million to Agricultural Cooperative Bank of Armenia (ACBA)-Credit Agricole Bank to increase lending to farmers and micro-, small and medium-sized enterprises (MSMEs) in the agribusiness sector. According to Thomas Lubeck, the local IFC regional head, “The agriculture sector is the largest employer in Armenia, and has been negatively affected by the financial crisis and by adverse weather conditions last year. Our cooperation with this strategic agribusiness lender will enable us to reach more micro, small, and medium enterprises and agribusiness sector companies in the underserved regions outside the capital, helping improve access to finance and sustain jobs.” In 2010, IFC loaned USD 3 million to the leasing arm of ACBA to increase leasing of capital goods to small and medium-sized enterprises.

As of 2009, ACBA reports to the Microfinance Information Exchange (MIX), the microfinance information clearinghouse, USD 425 million in assets, a gross loan portfolio of USD 223 million, return on assets of 2.83 percent and return on equity of 13 percent.

By Julie Moksim, Research Associate

About the International Finance Corporation (IFC): The International Finance Corporation (IFC) is a member of the World Bank Group that was created to support private sector development, mobilize private capital and provide advisory and risk mitigation services to businesses and services. IFC offers loans, equity investments, advisory services and technical assistance to private companies with the intent of alleviating poverty and promoting open and competitive markets in developing countries. As of 2011, IFC has 182 member countries that drive its policies and approve disbursements. As of June 30, 2010, IFC reported net income of USD 1.75 billion, total assets of USD 61 billion and return on assets of 3.1 percent.

About Agricultural Cooperative Bank of Armenia (ACBA)-Credit Agricole Bank: Agricultural Cooperative Bank of Armenia (ACBA) was founded by the Agricultural Cooperative Regional Unions of the three Armenian provinces of Shirak, Armavir and Ararat and obtained a full banking license on March 29, 1996. ACBA was initially created to finance small and medium-sized agricultural enterprises and individual farmers. In the next few years the bank began to finance non-agricultural programs in the agricultural sector. Since 1999, ACBA has extended loans for small and medium-sized business development. In 2006, Credit Agricole SA France, made an investment in ACBA and the bank was reorganized into ACBA-Credit Agricole Bank CJSC. As of 2009, ACBA reports to the Microfinance Information Exchange (MIX), the microfinance information clearinghouse, USD 425 million in assets, a gross loan portfolio of USD 223 million, return on assets of 2.83 percent and return on equity of 13 percent.

Sources and Additional Resources:

International Finance Corporation (IFC) Press Release: “IFC Helps Armenian Bank Increase Lending to Micro, Small, and Medium Enterprises, Boosting Growth”, March 30, 2011, http://www.ifc.org/ifcext/media.nsf/content/SelectedPressRelease?OpenDoc…

MicroCapital.org Brief, June 10, 2011: International Finance Corporation (IFC) Loans $3m to Agricultural Bank of Armenia (ACBA) Leasing for Small and Medium-Sized Enterprises (SMEs), http://www.microcapital.org/microcapital-brief-international-finance-cor…

MicroCapital’s Microfinance Universe Profile: International Finance Corporation (IFC)

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MicroCapital’s Microfinance Universe Profile: Agricultural Cooperative Bank of Armenia (ACBA)-Credit Agricole Bank
http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=ACB…

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