IFC Loan to Increase Small Business Lending in Georgia, Support Economic Recovery
By Messenger Staff
Thursday, July 15Tbilisi, Georgia, July 14, 2010—IFC, a member of the World Bank Group, is providing Georgia’s Bank Republic with a $20 million loan to increase access to finance for small and medium enterprises and help speed up economic recovery.
It is a part of IFC’s regional strategy aimed at strengthening the region’s banking sector while supporting economic recovery by boosting lending to small and medium enterprises.
“Bank Republic and IFC enjoy the mutually beneficial and very professional long-term partnership that ultimately facilitates the development of the banking, financial, and economic sector of the country,” said Gilbert Hie, CEO of Bank Republic. “The loan provided by IFC will support expansion of our portfolio in upcoming period, thus making Bank Republic more capable to offer a wide range of banking solutions to small, medium, and large corporate customers.”
Thomas Lubeck, IFC Regional Head, Caucasus, said, “We are pleased to expand our strong partnership with Bank Republic. IFC’s financing will improve access to finance for small and medium enterprises, which account for significant output and employment in the Georgian economy, and it will support job creation and economic growth.”
IFC began working with Bank Republic in 2005, through IFC’s corporate governance project in Georgia. As a result, Bank Republic became the first Georgian bank to attract western investors. In the past two years, IFC has provided Bank Republic with $42 million debt finance to support the bank’s lending programs for small and medium enterprises, mortgages, and education. The bank also participated in the IFC Global Trade Finance Program.
In March 2009, the largest multilateral investors and lenders in Central and Eastern Europe—the European Bank for Reconstruction and Development, the European Investment Bank Group, and the World Bank Group, including IFC—pledged to provide up to Euro24.5 billion to support the banking sectors in the region and to fund lending to businesses hit by the global economic crisis. Under the two-year plan, the World Bank Group pledged to provide support of about Euro7.5 billion including up to Euro2 billion through IFC. IFC’s crisis response initiatives under the plan focus on sectors including banking, infrastructure, and trade, as well as through its traditional investment and advisory services.