KfW ready for agro-financing project second phase in Azerbaijan
Azerbaijan, Baku, June 30 / Trend, I. Khalilova /
The German development bank KfW is ready to launch the second phase of the rural agro-financing project in Azerbaijan, KfW Baku Office said on Thursday.
"Financial projects manager of the German Development Bank KfW Gerald Huebner is expected to visit Baku on July 3-9 to discuss this issue. He will meet with representatives of banks," KfW Baku Office said.
KfW is considering Azerbaijani Turanbank's candidacy to issue the first loan on the project's second phase.
In Turanbank, assessment has been already held and now due to its experience in the rural areas it is a potential candidate for the KfW loan worth $1.5 -2 million euros.
Developed branch network in regions of the country and trained personnel are among the requirements to get loans under this project.
The bank plans to allocate three million euros to the country to finance the second phase.
The cost of the first phase of the project is 5 million euro.
Loans were distributed between two credit agencies -- Bank Respublika and non-bank credit organization CredAgro. Bank Respublika received 1.5 million euro, while 2 million has been allocated to CredAgro.
This money, like that assigned under the first phase will be assigned as subordinated loans.
The loan terms are similar to that of the financing of banks through the German-Azerbaijani Fund.
The first agreement was signed with CredAgro. CredAgro specializes in its activity on agro-financing, in difference to banks. CredAgro was established in 2000 by the international humanitarian organization ACDI/VOCA.
CredAgro is oriented on financing of projects in regions and covers 27 regions. It established 9 representations and has supporting offices.
Bank Respublika started operating in 1992. The bank has 34 branches and units in Baku and the regions.
The number of the bank's shareholders includes Germany's two large financial organizations: DEG, a member of the KfW banking group, and SIDT, a member of Sparkassen-Finanzgruppe holding 25 percent plus one share of the bank's interest.