Finance

Finance

EBRD synthetic loan to be available for AccessBank in 1Q next year

15 December 2009 15:03 (UTC +04:00)

Baku. Vugar Mustafayev â€“ APA-Economics. The first tranche of the EBRDâ€™s synthetic loan will be available for Azerbaijanâ€™s AccessBank in the first quarter in 2010, Andrew Pospielovsky, General Manager of AccessBank, told APA-Economics.
According to him, the loan will be fully delivered during next year.
The proceeds of the credit line will be used to finance investments and working capital of local businesses with medium and long-term loans. Additionally, a part of the loan will be used to increase lending to women entrepreneurs in Azerbaijan.
The EBRD is providing its first synthetic loan in Azeri Manat (AZN) to AccessBank, for an amount equivalent up to $10 million. Under the synthetic loan structure, the EBRD is providing the financing in US dollars, while AccessBankâ€™s loan obligation is the AZN value of the provided funds. The synthetic loan, a cost-effective tool, helps the institution to manage its foreign exchange risk, to increase the term of its local currency funding, and to expand its portfolio of AZN loans, particularly needed in rural areas of the country.
The EBRD loan will also enable AccessBank to meet the high demand for loans from micro and small enterprises in Azerbaijan, which still have limited access to financing.
Established in 2002 by the EBRD, KfW Development Bank, International Finance Corporation and Black Sea Trade and Development Bank, AccessBank is currently the leading provider of financial services to micro, small and medium-sized businesses in Azerbaijan.
To date the EBRD, which holds a 20 per cent stake in AccessBank, has supported the institution through three facilities worth a total of $43 million, which includes a syndicated loan of $28 million.
Since the beginning of its operations in Azerbaijan, the EBRD has committed over $1 billion across more than 90 projects in corporate, financial, infrastructure and energy sectors.