OREANDA-NEWS. On August 06, 2008 The European Bank for Reconstruction and Development has provided two four-year loans totalling 1.02 billion roubles (equivalent to EUR27.5 million) to Sovcombank to finance micro, small and medium-sized enterprises in a transaction aimed at funding the grassroots sector of the economy in the regions of Russia, reported the press-centre of EBRD.

A total of 55 million people live in the areas where Sovcombank and its subsidiary credit agency and bank operate in Central and NorthWest Russia, the Urals, Western Siberia and the Russian Far East.

Just under half of the amount, 490 million roubles, will be provided within the framework of the EBRD’s Russian Small Business Fund (RSBF) programme. The remaining 530 million roubles of the EBRD loan are being provided for on-lending to small and medium-sized enterprises.

Sovcombank thus becomes the 18th Russian bank to join the RSBF programme, which has made over 440,000 loans worth a cumulative total of nearly USD6 billion since it was launched with financial support from the G-7 and Switzerland in 1993.

This is the first EBRD transaction with Sovcombank, whose headquarters are in Kostroma, and which is majority-owned by TBIF, a Dutch financial subsidiary of the Kardan investment group, a Dutch public company.

Sovcombank’s mission is to contribute to the development of small and medium-sized cities by providing access to high quality retail banking services, as well as funding for small businesses.

Through this loan the EBRD is channelling funding to Russia’s grassroots economy, particularly to borrowers in small towns in the heartlands of Russia who often have no other access to banking services, said George Orlov, the EBRD’s Director, Financial Institutions, Russia.