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Bucharest, Romania, June 27, 2007 —
IFC, the private sector arm of the World Bank Group, will provide a five-year local currency loan to Romania’s ProCredit Bank to expand its operations, promoting competition and improving access to finance for micro, small, and medium enterprises.
The $15 million equivalent investment will be the second local currency loan offered by IFC in the Romanian market. As an internationally triple-A rated institution, IFC leverages its credit to provide customized local currency products to private sector clients.
Michael Kowalski, General Manager of ProCredit Bank, said, “smaller businesses are critical for economic development in Romania, and they have proven to be dynamic and reliable partners. The IFC loan should trigger further growth in our loan portfolio and increase access to finance for many more very small and small entrepreneurs.”
Shahbaz Mavaddat, IFC Director for Southern Europe and Central Asia, said, "We are pleased to work with ProCredit Bank to provide local currency, long-term funding to micro, small, and medium enterprises in the country. Improving access to finance through a dynamic private commercial bank like ProCredit Bank is important to strengthen the small business segment of the economy and prepare it for competition.”
Ana Maria Mihaescu, IFC Chief of Mission in Romania, said, “IFC's innovative initiative to provide long-term funding in local currency to Romanian banks will help them better match the maturities of their assets and liabilities. The lack of such financing has meant that borrowers, particularly smaller businesses, have had difficulty obtaining financing or received foreign currency loans at their own currency risk
.
Borrowing in a currency different from that of one’s revenues is ultimately a risk. Therefore, firms are prudent to concentrate on their core businesses and not take on currency bets.”
About IFC
IFC, the private sector arm of the World Bank Group, promotes open and competitive markets in developing countries. IFC supports sustainable private sector companies and other partners in generating productive jobs and delivering basic services, so that people have opportunities to escape poverty and improve their lives. Through FY06, IFC Financial Products has committed more than $56 billion in funding for private sector investments and mobilized an additional $25 billion in syndications for 3,531 companies in 140 developing countries. IFC Advisory Services and donor partners have provided more than $1 billion in program support to build small enterprises, to accelerate private participation in infrastructure, to improve the business enabling environment, to increase access to finance, and to strengthen environmental and social sustainability. For more information, please visit
www.ifc.org
.
About ProCredit Bank, Romania
ProCredit Bank, founded in 2002, is a
development-oriented full-service bank in Romania. It offers excellent customer service and a wide range of banking products. In its credit operations, it focuses on lending to very small, small, and medium enterprises, as these businesses create the largest number of jobs and make a vital contribution to the Romanian economy. The bank is the leading provider of credit and general banking services to entrepreneurs and businesses throughout Romania. Unlike other banks, it does not promote consumer loans, but instead focuses on responsible banking by building a savings culture and long-term partnerships with its customers. ProCredit Bank offers its clients – individuals as well as legal entities – various deposit options at attractive conditions. ProCredit Bank Romania is part of the ProCredit Group, which is present on three continents. For more information, please visit
www.procreditbank.ro
and
www.procredit-holding.com
.
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