IFC PROVIDES FINANCING TO LITHUANIAN BANK
Brigid Janssen
Phone: (202) 458-4698
Fax: (202) 974-4384
E-mail: bjanssen@ifc.org
WASHINGTON, D.C., June 30, 1999 – The
International Finance Corporation today agreed to a loan of US$20 million
to Vilniaus Bankas, the largest private bank in Lithuania, for on-lending
to small- and medium-size enterprises (SMEs) and to meet the growing demand
for housing finance.
The loan, with a final maturity of seven years, will ease the shortage
of medium-term funding for smaller businesses and help finance mortgages
for residential housing.
The loan will bolster the development of Lithuania's banking sector, said
Mr. Harold Rosen, Director of IFC's Central and Southern Europe Department.
The long-term IFC loan extends the maturity of Vilniaus Bankas' funding
base and recognizes the progress that Vilniaus Bankas has made in improving
its loan quality, risk management procedures and operational efficiency,
he said. The project would support SMEs by channeling additional
funds for longer maturities and improve living standards by expanding long-term
mortgages to homebuyers, Mr. Rosen added.
Mr. Julius Niedvaras, Chairman of Vilniaus Bankas, said that the bank plans
to increase its resource allocation to the SME sector and retail banking.
The IFC loan would enable Vilniaus Bankas to grant more long-term loans,
with maturities of two to seven years, for project finance by SMEs that
are private companies with less than LTL 60 million (US$15 million equivalent)
in total assets. The IFC loan will also enable Vilniaus Bankas to satisfy
the growing need for long-term mortgage loans with maturity of four to
seven years.
The mission of IFC, part of the World Bank Group, is to promote private
sector investment in developing countries, which will reduce poverty and
improve people's lives. IFC finances private sector investments in
the developing world, mobilizes capital in the international financial
markets, and provides technical assistance and advice to governments and
businesses.
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