Washington D.C., May 25, 2004—
The International Finance Corporation, the private sector arm of the World Bank Group, has invested in BRAC Bank, a specialized provider of credit and other financial services to small and medium enterprises in Bangladesh.
The bank was established by the Bangladesh Rural Advancement Committee (BRAC) in 2001. BRAC is one of the most successful NGOs in the world, with a large presence in rural and urban Bangladesh. Its development experience dates back over 25 years during which time it has excelled in its core activities: education (1.2 million students), health care (14 million patients), and microfinance (3.4 million clients).
IFC’s investment—which comprises a share purchase of up to $1.6 million, amounting to 19 percent of BRAC Bank’s shareholding—will help expand sustainable SME finance by supporting a strong formal financial institution that caters to the highly specialized needs of SME owners.
Noting that IFC is pleased to be partnering with BRAC Bank in such a high-impact investment, Mr. Dimitris Tsitsiragos, director of IFC's South Asia Department, said, "IFC is committed to supporting and strengthening Bangladesh’s financial sector, enabling it to provide a full range of services to small and medium business owners.”
Mr. Fazle Hasan Abed, chairman of BRAC Bank and founder of BRAC, added, “IFC’s investment in BRAC Bank will provide an added incentive to small enterprise development, thereby stimulating job creation and income-generating opportunities throughout the country.”
This investment complements IFC's efforts to support SME development in Bangladesh through the multidonor SouthAsia Enterprise Development Facility, which provides a range of technical assistance to improve the business environment as well as the availability of business services and finance for SMEs.
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, helps clients improve social and environmental sustainability, and provides technical assistance and advice to governments and businesses. Since its founding in 1956, IFC has committed more than $37 billion of its own funds and arranged $22 billion in syndications for 2,990 companies in 140 developing countries. IFC's committed portfolio at the end of FY03 was $16.8 billion.
