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| Summary of Project Information (SPI) |
| This Summary of Project Information is prepared and distributed to the public in advance of the IFC Board of Directors’ consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC’s activities, and this document should not be construed as presuming the outcome of the Board decision. Board dates are estimates only. |
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| Project number | 24004 |
| Project name | Open Joint Stock Company "Bank Eskhata" |
| Country | Tajikistan |
| Sector | Finance & Insurance |
| Department | Global Financial Markets Group |
| Company name | Open Joint Stock Company "Bank Eskhata" |
| Environmental category | FI-1 |
| Date SPI disclosed | June 21, 2005 |
| Projected board date | July 21, 2005 |
| Status | Active |
| Previous Events | Invested: October 4, 2005
Signed: August 25, 2005 |
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| Description of company and purpose of project |
This project – Open Joint-Stock Company Eskhata Bank (Eskhata Bank or the Bank) – is part of IFC's Central Asia Micro and Small Enterprise Facility (the Facility), comprising of individual credit lines to selected partner banks for on-lending to micro and small enterprises (MSEs) through specialized micro and small business finance windows created at the partner banks’ level for this purpose. Within the framework of the facility, IFC will, in close collaboration with EBRD, make available up to $45 million for lending (in the form of credit lines) to selected local banks for onlending to micro and small enterprises (MSEs) in Kazakhstan, The Kyrgyz Republic, Uzbekistan, and Tajikistan.
Eskhata Bank, a Tajik commercial bank with approximately 4% of the banking system’s total assets in Tajikistan, has been selected as a partner bank for the Facility. It was registered as a commercial bank on November 16, 1993 following the issue of a General License for banking operations by the National Bank of Tajikistan. Eskhata Bank has obtained licenses for conducting all types of banking operations, including foreign currency dealings. The main objective for the establishment of the Bank was to provide private companies and individuals (mostly in the cotton and agribusiness sectors) with access to credit and with a range of diversified banking services.
The objective of this project is to expand the frontier of finance by extending downward the range of market segments served by Eskhata Bank. Thus, the IFC credit line will increase the availability of sustained credit to creditworthy MSEs, while at the same time building up the lending capacity and skill base of Eskhata Bank. |
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| Project sponsor and major shareholders of project company |
As of 31 December 2003, Eskhata Bank’s shareholding structure was as follows:
- Nasirov Family: 36%
- Javoni: 12%
- Mr. Abdulloyev: 8%
- Mrs. Abdulleyova: 7%
- Others (less than 5% shareholding): 37% |
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| Total project cost and proposed IFC investment |
| The project involves an IFC investment of up to $1.0 million in the form of a credit line to Eskhata Bank. |
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| Location of project and description of site |
| The Head-Office of Eskhata Bank is located in Khujand City in Sugd Region, the northern part of Tajikistan. The Bank has around thirty representative offices (outlets) in Tajikistan, and one branch in Dushanbe, which started its operation in January 2003. |
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| Project Development Impact and IFC's Role |
IFC’s investment in Eskhata Bank will have a strong development impact, as it will augment the availability of micro and small business finance in Tajikistan, and thus it aims to improve the standard of living of the poorest segments of the population.
Microfinance is a key sector where IFC can focus its efforts to support economic development. The IFC investment will assist in the development of the micro and small business enterprise sector in Tajikistan by augmenting financing to existing MSEs. It will also have a strong institution-building role. By providing Eskhata Bank with training and technical assistance, the project will seek to address the shortage of banking skills that are necessary to establish a market-based banking environment, especially with respect to MSEs. An additional key objective of this project is to generate a significant international demonstration effect, which can catalyze replication of model microfinance programs in developing countries, and in Central Asia in particular. |
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| Environmental and social issues - Category FI-1 |
This is a Financial Intermediary (FI) Type 1 project according to IFC's environmental and social review procedure. The Bank will be required to develop and implement an Environmental Management System (EMS) to screen loan applications for compliance with host country environment, health and safety requirements and consistency with a Microfinance Exclusion List developed jointly by EBRD and IFC. Further, Eskhata Bank must identify two individuals with responsibilities for environmental matters and provide the appropriate training. The Bank will also be required to provide an Annual Report on its EMS. Eskhata Bank will commit to meet the above requirements.
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| To contact the project company, please write to: |
Dimitre Mitov, Senior Investment Officer
Email: dmitov@ifc.org |
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