Tirana, Albania, May 31, 2001
─The International Finance Corporation (IFC), the private sector arm of the World Bank Group, will extend a partial guarantee facility to the American Bank of Albania (ABA) to expand its portfolio of small and medium-sized enterprises (SMEs).
IFC's partial guarantee is the first financial product of its kind in Albania, and will pave the way for other new and innovative financial interventions to support the SME sector in the country.
IFC will guarantee 50 percent of each approved loan by ABA to finance eligible sub-projects within IFC’s maximum aggregate exposure of up to US$2.5 million. The sub-projects will be identified by ABA in close collaboration with the Southeast Europe Enterprise Development Facility (SEED), a development facility established by the World Bank Group and international donors to operate in Albania, Bosnia and Herzegovina, FYR Macedonia, and Kosovo.
Mr. Khosrow Zamani, Director of IFC’s Southern Europe and Central Asia Department said that through this project, IFC is supporting the dynamic small and medium-sized enterprise sector in a challenging environment and at a difficult moment in the region. It is part of the World Bank Group’s efforts to support the country and is in line with IFC’s strategy to strengthen the SME sector through strong financial intermediaries, he said. IFC expects that this project will encourage further investment in both the country and the region as a whole, Mr. Zamani added.
ABA was founded in 1998 by the Albanian-American Enterprise Fund, a non-profit organization that provides medium term financing to Albanian legal entities. The bank successfully provides all commercial banking services in Albania through its Tirana head office and Durres branch. ABA has introduced the first internet banking service in Albania and has an agreement with Unioni Financiar Tirane, representative of Western Union, for the distribution of ABA's Certificate of Deposit through the branch network of 107 money transfer agencies in Albania and Kosovo.
IFC has been playing an active role in Albania since the country became a member in 1991, and has approved financing of approximately $90.5 million in six projects with a total cost of $360 million.
The mission of IFC, part of the World Bank Group, is to promote sustainable private sector investment in developing countries as a way to reduce poverty and improve people's lives. IFC finances private sector investments in the developing world, mobilizes capital in the international financial markets, and provides technical assistance and advice to governments and businesses.
