Pristina, Kosovo, December 3, 2001
—The International Finance Corporation (IFC), the private sector arm of the World Bank Group, has become the newest shareholder of Micro Enterprise Bank Ltd., Kosovo’s leading commercial bank and a specialized provider of small and microenterprise financing. IFC invested approximately US$1.1 million for 16.7 percent of the equity of the bank – its first direct investment in Kosovo.
The IFC investment will provide much-needed growth capital for Micro Enterprise Bank, the first financial institution to be licensed in post-conflict Kosovo. Although initially developed to provide micro credit, Micro Enterprise Bank has quickly become a key part of the payments infrastructure of Kosovo, which was wiped out by the conflict in Yugoslavia. Micro Enterprise Bank is meeting Kosovo’s growing demand for financial services through providing account management, foreign exchange and money transfer services, loans and cashless payment transactions to micro and small enterprises and individual customers.
“Sustaining economic recovery in Kosovo depends on the availability of basic banking services,” said Khosrow Zamani, Director of IFC’s Southern Europe and Central Asia Department. "Micro Enterprise Bank does just that, giving ordinary people the means to provide for their own livelihoods. It has become a dependable, commercial-oriented source of credit and other financial services for micro and small businesses, which form the backbone of the Kosovar economy." Mr. Zamani emphasized the importance of strong financial intermediaries to private sector development.
Established in late 1999 as a joint initiative of IFC, the European Bank for Reconstruction and Development (EBRD), and Internationale Projekt Consult, Micro Enterprise Bank is based in Pristina. The bank now has seven branches throughout Kosovo. In addition to IFC and EBRD, shareholders include Nederlandse Financierungs Maatschappij Voor Ontwikkelingslanden (FMO), Commerzbank, Foundation for Enterprise Finance and Development (FEFAD), and Internationale Micro Investitionen (IMI). Following IFC’s investment, Micro Enterprise Bank’s share capital rose to US$6.6 million equivalent.
Micro Enterprise Bank is IFC’s seventh transaction under its Microfinance Capacity Building Facility. The Facility, approved by IFC’s Board of Directors in May 2000, provides for up to $11.3 million in direct investments to establish microfinance institutions in IFC-member developing countries and $1.4 million in trust funds for co-financing technical assistance and start-up costs for microfinance institutions.
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, IFC has committed more than $31 billion of its own funds and arranged $20 billion in syndications for 2,636 companies in 140 developing countries. IFC’s committed portfolio at the end of FY01 was $14.3 billion.
