Banks to Receive KfW Credit for Agrofinancing in Azerbaijan Determined

Business Materials 14 July 2008 17:45 (UTC +04:00)

Azerbaijan, Baku, 14 July / Trend corr I.Khalilova/ "German development bank KfW intends to sign credit agreements with two Azerbaijani banks - Bank Respublika and Azerdemiryolbank - within rural agrofinancing project," KfW Baku office reported on 14 July. KfW selected two banks and one non-bank credit organization (CredAgro) to implement agrofinancing in Azerbaijan through them.

KfW allotted 5mln euro for development of agriculture in Azerbaijan, with 2mln euro intended for CredAgro and 3mln for the two banks. Credit agreement has been signed only with CredAgro.

The German bank plans to grant subordinate loans. These resources are meant for agricultural crediting.

The first stage will cover Shaki-Zagatala and Gakh regions of Azerbaijan.

The loan terms will be the same in terms of financing through German-Azerbaijan Fund.

The only founder of CredAgro is international humanitarian organization ACDI-VOCA, which established the organization in Azerbaijan 8 years ago. The authorized capital stock of the organization is $5,000, with aggregate capital of AZN 7mln.

At present, the activities of CredAgro focus on financing projects in the regions and it covers 27 regions. The Bank has established 9 representations and several back offices. The Bank finances various spheres including trade operations, infrastructure, leasing and consumer crediting. The credit is granted for CredAgro with 36% interest rate annually for 3 year term.

Azerdemiryolbank OJSC, one of the first commercial banks in Azerbaijan, was established in 1989. In recent 18 years, the bank was developing and improving its position in Azerbaijan's banking market. Bank's 29 branches and offices are currently operating in Baku and other regions of the country.

Bank Respublika commenced operation on 22 May 1992 . One of bank's important priorities is expansion of operation geography and service network which currently includes 19 branches and 9 offices.

On 14 July, official exchange rate totalled 0.8057 AZN/USD.

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