Baku, Azerbaijan, October 30, 2002
—The International Finance Corporation (IFC), the private-sector development arm of the World Bank Group, has sponsored the establishment of the first commercial bank in Azerbaijan dedicated to serving micro and small enterprises. Micro Finance Bank Azerbaijan (MBFA), which opened its doors today, is a joint venture of IFC, the European Bank for Reconstruction and Development (EBRD), the Black Sea Trade and Development Bank (BSTDB), and LFS Financial Systems GmbH.
IFC has invested US$1.75 million in Micro Finance Bank Azerbaijan for a 35 percent shareholding. The bank, which is based in Baku with a staff of 25 and is expected to open branches in the major regional centers of Sumgait and Ganja next year, has equity capital of $5 million.
“IFC is pleased to support a pioneer financial institution dedicated to micro and small entrepreneurs in Azerbaijan,” said Khosrow Zamani, Director of IFC's Southern Europe and Central Asia Department. “We are committed to encouraging the growth of strong private sector enterprises in Azerbaijan and investing in the local financial sector is critical to achieve this aim. The financial services offered by Micro Finance Bank Azerbaijan will give ordinary people the means to provide for their own livelihoods.” Mr. Zamani emphasized the importance of strong financial intermediaries to private sector development.
IFC’s investment will introduce commercially-oriented microfinance techniques in Azerbaijan and help to bolster confidence in the country’s banking system. IFC believes that well-managed microfinance institutions can be viable and provide substantial and sustainable increases in the volume and scope of financial services available to microenterpreneurs and small enterprises.
IFC’s mission is to promote sustainable private sector investment in developing countries, helping 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. Since its founding in 1956 through FY02, IFC has committed more than $34 billion of its own funds and arranged $21 billion in syndications for 2,825 companies in 140 developing countries. IFC’s worldwide committed portfolio as of FY02 was $15.1 billion for its own account and $6.5 billion held for participants in loan syndications.
