Ulaanbaatar, Mongolia, March 26, 2013—
IFC, a member of the World Bank Group, on Tuesday agreed to provide $20 million to Khan Bank LLC, Mongolia’s largest bank by assets, to increase lending to small and medium enterprises.
IFC’s five-year senior loan will help the bank make loans to 5,000 additional small and medium enterprises over the next five years.
“IFC’s investment will support our efforts to satisfy increasing financing needs among a rapidly growing Mongolian economy,” said Khan Bank’s Chairman Mr. Hideo Sawada. “IFC adds value to our business, not only through its financing, but also through its global standing as a leading multilateral lender. Working with IFC boosts our ability to provide financial services to an increasing number of smaller businesses and improves confidence in the banking sector.”
Mongolia’s economy is undergoing a major transformation driven by its mining industry, but financing for smaller businesses remains critical for the Mongolian economy to make the most of these opportunities. By supporting smaller enterprises, IFC helps Mongolia’s economic diversification and job creation.
IFC is the third-largest shareholder in Khan Bank, owning a 9.3 percent stake and previously provided financing and advisory services to support the bank’s assessment of the small and medium enterprise customer market segment and to strengthen its capital position. Since becoming an IFC client in 2004, Khan Bank has grown to become the largest bank in Mongolia by assets and branch network, reaching about 80 percent of Mongolian households.
The signing coincides with the 10th anniversary of Khan Bank’s privatization. During the last decade the bank has provided a solid foundation for Mongolia’s future growth.
“While international capital markets have been volatile, Mongolia's economy is growing at a remarkable rate,” said Sérgio Pimenta, IFC’s Director for East Asia and the Pacific. “We are confident that Khan Bank will continue to play an important role in helping to spread the benefits of Mongolia’s growth to the broader society by helping small and medium entrepreneurs to grow and create jobs.”
About IFC
IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector. We help developing countries achieve sustainable growth by financing investment, mobilizing capital in international financial markets, and providing advisory services to businesses and governments. In FY12, our investments reached an all-time high of more than $20 billion, leveraging the power of the private sector to create jobs, spark innovation, and tackle the world’s most pressing development challenges. For more information, visit
www.ifc.org
.
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