Azerbaijan, Baku, May 5 / Trend , N.Ismayilova/
The International Financial Corporation (IFC) has allocated $10 million to the Azerbaijani AGBank to finance small and medium business, director of the IFC for South Europe and Central Asia regions Shahbaz Mavaddat said during the signing of the document between the corporation and bank.
"This subordinate loan will be directed at increasing the bank's capital base and allow it to fund 70,000 projects in the field of small and medium businesses. This cooperation will improve the access of small and medium-sized enterprises to finance the country, as well as support the development of non-oil sector in the country," Mavaddat said.
The loan is corporation's part of previously approved investment $15 million to the bank. Credit granted for a term of eight years. The Bank will receive it as the two tranches of 5 million manat. The first tranche has already been granted, the second is expected in five months. The remaining 5 million of the total subordinate loan the bank receives in a year.
The bank and corporation agreed on prolonging of technical assistance, which was directed to enhance risk management in AGBank.
"Country' banking sector need this assistance. The risk management is introduced in the bank," chairman of bank's Supervisory Board Chingiz Asadullayev said.
The agreement was signed by SGBank Board Chairman Azar Movsumov and director of the IFC for South Europe and Central Asia regions Shahbaz Mavaddat
Financial Corporation has already provided AGBank three credits for financing leasing operations in 1998, 2003 and 2006. Also in June 2006, IFC acquired a 17.5-percent share of AGBank's capital for 1.470 million manats.
This is the second major loan by foreign corporation to bank. On April 1, an agreement was signed with OFID two credit lines amounting to $10 million.
Currently, AGBank has two foreign shareholders. In May 2008, 10 per cent shares of the bank were transferred to an American company Kazimir Investment Caspian Fund for 8.36 million manats at their nominal value in 1.5 million manat.
Bank's authorized capital increased to 26.556 million manat at nominal cost of 10,000 manat.
Major shareholders of the bank are Chiniz Asadullayev and Farzulla Yusifov, as well as IFC and Kazimir Caspian Fund Limited. Bank has 13 branches.
On May 5, the official exchange rate is 0.8034 manat to $1.
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