The EBRD provided US $ 30 million to the fourth largest financial institution in Uzbekistan, Joint-Stock Commercial Mortgage Bank Ipoteka-Bank (the "Ipoteka-Bank"). The financing package consists of US $ 25 million credit to support micro, small and medium-sized businesses (MSMEs) and a trade finance limit of up to US $ 5 million under the EBRD's Trade Facilitation Program (TFP) was signed in Tashkent.
MSMEs are playing an increasingly important role in Uzbekistan's economy. In 2016, SMEs generated nearly 60% of the country's GDP and provided more than 75% of total jobs. At the same time, considering the overall low level of bank loans to GDP (27%), MSMEs are clearly underserved by the current financial market and require more financing than is currently available.
With the network of 38 branches and over 700 outlets across Uzbekistan, Ipoteka-Bank will be well placed to provide much-needed financial resources to small businesses. In addition to the financing, EBRD will provide a technical assistance to Ipoteka-Bank in the form of advisory services to the MSMEs.
Meanwhile, the trade finance facility will help Ipoteka-Bank to facilitate cross-border trade, contributing to fostering, regional connectivity and integration, to further develop its correspondent banking services and strengthen its trade finance product range.
Nick Tesseyman, the Managing Director for the Financial Institutions at the EBRD, said: "We are very glad to partner with Ipoteka-Bank to support lending to MSMEs and Trade Facilitation Program. We consider MSMEs as the backbone of the economy and as a result of it. We are confident that effective cooperation between our institutions can become a springboard for further strong, positive development and actions that will deliver long lasting benefits to the Uzbek financial sector. "
The EBRD is the largest institutional investor in Central Asia, with close to € 11.6 billion (US $ 12.3 billion equivalent) committed to projects in a variety of sectors, from infrastructure to agriculture.
To date, the EBRD invested € 864 million in Uzbekistan in 57 projects. Entering a new stage of engagement in the country, the Bank has already identified a number of possible new projects, some of which are due to 2017, with more to follow in 2018.