EBRD PROVIDES $4 MILLION SYNTHETIC LOAN TO FINCA UCO
ARKA
March 19, 2010
YEREVAN, March 19, /ARKA/. The EBRD is boosting the availability of
local currency financing in Armenia with a synthetic loan in Armenian
Drams (AMD) worth $4 million to FINCA UCO CJSC for on-lending to
local micro and small enterprises (MSEs).
An agreement to that end was signed in Yerevan March 18 by EBRD
president Thomas Mirow and FINCA executive director Yervand Barseghyan.
Wholly-owned by U.S. based FINCA International, FINCA UCO CJSC is the
third largest non-bank credit organization in Armenia by its assets
size, servicing MSEs, with a special focus on the smallest borrowers
in rural areas.
The proceeds of the EBRD loan will enable FINCA UCO CJSC to meet the
growing demand for local currency financing and increase its outreach
to entrepreneurs in remote areas.
The synthetic local currency loan, the first one provided by the
EBRD to a microfinance institution in Armenia, will help FINCA UCO
CJSC increase the term of its local currency funding, and expand
its portfolio of loans in AMD. This will enable FINCA UCO CJSC’s
clients to repay their loans in the same currency as they earn from
their operations.
The EBRD loan is complemented by a technical assistance grant from
the EBRD’s Early Transition Countries Multi Donor Fund, which will
be used to strengthen risk management practices at FINCA UCO CJSC
and to help the institution develop new products.
"Through this transaction, the EBRD is boosting its support for the
development of the private sector in Armenia which is dominated by
micro and small enterprises. The local currency loan will enable
FINCA UCO CJSC and its clients to reduce foreign exchange risks",
said EBRD President, Thomas Mirow.
"FINCA UCO CJSC is very happy to count the EBRD as a strategic
partner. I’m confident that we will continue to help the lowest income
entrepreneurs in Armenia and, in turn, the development of the country,"
said FINCA UCO CJSC CEO, Yervand Barseghyan.
Overall, since the beginning of its operations in Armenia, the EBRD
has committed over ~@393 million in 77 projects in the financial,
corporate, infrastructure and energy sectors.