OREANDA-NEWS. The EBRD is making its first syndicated loan in Armenia with a ?12 million credit to ACBA Credit Agricole Bank CJSC targeting the growing financial requirements of local entrepreneurs, especially in rural and remote areas, thanks to a rapidly growing economy, reported the press-centre of EBRD.

The EBRD is providing half of the total loan amount, with the remaining ?6 million to be syndicated to Citi under the EBRD’s A/B loan structure.

This first syndicated loan to a financial institution in Armenia is expected to demonstrate the advantages to the sector of gaining access to commercial funds in this way and other similar projects may follow.

ACBA was established in 1996 and late last year Credit Agricole became a shareholder. The bank has become a key player in the Armenian banking sector and is the country’s leading bank in terms of capital and third largest measured by total assets. With close to 70 percent market share in rural lending, ACBA is the only commercial bank in Armenia that is largely focused on providing financial services to micro, small and medium-sized enterprises.

Michael Weinstein, head of the EBRD’s Yerevan office, said micro and small businesses are vital for economic development and play a crucial role in promoting the country’s transition towards a market economy. “This transaction will directly support this important sector by providing increased access to financing and marks the opening of international capital markets for one of the leading Armenian banks”, he added.

ACBA’s CEO Stepan Gishyan said “ACBA has always been a leader in introducing financial products and I am pleased that once again ACBA Credit Agricole Bank is the first bank in Armenia to receive a syndicated loan. As a universal bank, Credit Agricole has always focused its attention on MSE lending both in urban and rural areas and will continue this policy in the future. The first syndicated loan in Armenia will support the realisation of our strategy in the sector.”

Michael Jinn, Fixed Income Managing Director for Citi, said, “We are pleased to have participated in this transaction with EBRD and ACBA Credit Agricole. This transaction demonstrates Citi's capability to provide access to finance to microlending institutions and our worldwide commitment to support microfinance initiatives.”

Through its micro and small enterprises programmes, the EBRD has supported over one million small enterprises throughout eastern Europe, Russia, central Asia and the Caucasus. Across its countries of operations, the EBRD has committed over $1 billion to 105 financial institutions to facilitate $15 billion in loans to micro and small businesses in the region.. In Armenia the EBRD has supported the establishment of a microfinance lending programme at three leading commercial banks.