OREANDA-NEWS. November 20, 2008. The EBRD is providing AccessBank, formerly known as Microfinance Bank of Azerbaijan, with a US28 million syndicated loan to deliver much-needed financing to the country’s micro and small enterprises, reported the press-centre of EBRD.

Despite the current difficult conditions on global capital markets, the loan was successfully syndicated to four foreign financial institutions.

The funding comprises a three-year US10 million A-loan for the EBRD’s own account and a three-year US18 million B-loan, of which US10 million have been taken up by the Netherlands Development Finance Company (FMO) and the remaining US8 million by WGZ Bank, Erste Bank and First Bank of Nigeria.

The loan will support the development of the financial sector in Azerbaijan and benefit local micro and small enterprises, the core client group of AccessBank, through on-lending. The bank has successfully developed its lending operations and become a reliable source of finance for micro and small businesses in Azerbaijan. Over the last three years, it has expanded its operations into rural areas of the country, where access to finance remains particularly difficult.

This is the first syndicated loan for AccessBank and as such is expected to have a significant demonstration effect. The loan will provide AccessBank with long-term funds unavailable from local sources and at the same time introduce it to international capital markets. With the current situation in the financial markets, the EBRD’s commitment is crucial for maintaining the confidence of all participants.

Francis Delaey, head of the EBRD office in Baku, said, “We are delighted to sign this loan agreement with AccessBank, because it will strengthen a leading private financial institution in Azerbaijan and also benefit local businesses. Given current circumstances in the international financial markets it is especially significant that we were able to syndicate the loan. This is a clear vote of confidence for the project. ”

Andrew Pospielovsky, General Manger of AccessBank, added, “The successful syndication of this loan at a time of international financial crisis is a demonstration of the strength of AccessBank and Azerbaijan’s economy. This will inspire further confidence among investors seeking solid ground.”

AccessBank was founded as Microfinance Bank of Azerbaijan in 1992. It currently has six shareholders: Black Sea Trade and Development Bank, the EBRD, the IFC, KfW, Access Holding and the German consultancy, LFS Financial Systems Ltd. A leading provider of financial services to micro and small businesses in Azerbaijan, AccessBank currently has 20 branch offices throughout the country.

Through its micro and small enterprises programmes, the EBRD has supported over three million small enterprises throughout eastern Europe, Russia, Central Asia and the Caucasus. The EBRD currently works with 108 commercial banks and non-bank microfinance institutions to establish or expand specialised micro and small business finance units and to date has lent over EUR1.1 billion to leverage EUR17 billion in loans to micro and small businesses in the region.