FMO Investment Company to allocate $6 million to “Respublica” Bank

Business Materials 28 December 2005 15:43 (UTC +04:00)

The loan agreement will be made between the stock-commercial bank “Respublica” and the FMO Dutch Investment Company in early 2006 on allocation of the credit amounting to some $6 million.

The funds are designed for financing trade transactions and development of small and medium entrepreneurship, the bank’s acting board chairman Asef Zeynalov told Trend. The FMO’ s credit resources are intended for 5 years at the libor+4% or libor+4,5% annual rate, which will depend on the arrangement under the loan agreement.

Zeynalov finds, there is a large demand in credit resources in the country today. It is profitable for the bank to loan on the account of the outside credits as the bank’s expenditures by this are by 1-2% lower, than involving funds from the domestic market. It is related to the increase of the interest rates for the deposits, which sometimes reach 15-18% annually under the present situation, in regard to changing the national currency rate; it is much cheaper to borrow from IFI.