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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 | 23990 |
| Project name | Hamkorbank II |
| Country | Uzbekistan |
| Sector | Finance & Insurance |
| Department | Global Financial Markets Group |
| Company name | Hamkorbank, Joint Stock Commercial Bank |
| Environmental category | FI-2 |
| Date SPI disclosed | March 17, 2006 |
| Projected board date | April 17, 2006 |
| Status | Active |
| Previous Events | Invested: May 15, 2007
Signed: November 10, 2006
Approved: July 28, 2006 |
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| Description of company and purpose of project |
The proposed project consists of the following:
- a second senior credit line of up to $3 million to Hamkorbank JSC (“Hamkorbank” or the “Bank”) and
- further technical assistance to the Bank in certain specific areas.
Hamkorbank is one of the largest privately owned banks in Uzbekistan, headquartered in Andijan, a northeastern town in Uzbekistan and focused on micro and small business lending. Initially the bank concentrated on the Andijan region, but has gradually spread its business to the neighboring Fergana region and major cities in Uzbekistan. The Bank offers not only SME loans but also micro loans, consumer loans and leasing products. Hamkorbank has been an IFC client since 2001, when IFC made a first investment of $1 million, along with the technical assistance, for the purpose of sub-lending to small and micro entrepreneurs in the region. |
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| Project sponsor and major shareholders of project company |
| Hamkorbank was initially founded as a closed joint-stock company. In 1992 it was reregistered as open joint-stock commercial company. Its shares are traded on the Uzbek stock exchange. The Bank’s shareholding structure is thinly dispersed among over 3,800 shareholders, almost 90% of which are individuals. Mr. Ibragimov, Chairman, together with family members, controls about 15% of the bank's voting stock. |
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| Total project cost and proposed IFC investment |
The proposed project consists of:
- a second senior credit line of up to $3 million to Hamkorbank for sub-lending to small entrepreneurs in Uzbekistan, and
- further technical assistance to the Bank in the areas including treasury operations, risk management, corporate lending, branch management, and human resource development. |
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| Location of project and description of site |
| Hamkorbank is headquartered in Andijan, Uzbekistan. Presently, the bank has 22 full-service branches and 41 mini-banks nationwide. The mini-banks are very small branches that function as teller/cashier for consumer transactions such as utilities payment, money transfers and deposits. |
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| Project Development Impact and IFC's Role |
| Development impact of the project is significant. IFC’s first credit line to the Bank played an important role in supporting small business growth, fostering income generation and creation of new jobs. In addition, the sub-borrowers financed through IFC credit line were able to invest in new technologies, expand existing operations and increase efficiency of their production activities. The proposed second IFC credit line will be provided to finance a growing SME loan portfolio and it is expected to further support the growth of SMEs, income and employment in the same region. In addition, through the technical assistance and the continuous supervision of the investment, IFC will support the enhancement of risk management of the Bank, reporting and portfolio monitoring, as well as the enhancement of staff skills. The Uzbek economy as a whole is still largely government-controlled with only minimal private sector participation and larger government-backed businesses crowd out the private sector in the competition for limited long-term resources. The proposed project would provide long-term resources for origination of loans to private SMEs. |
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| Environmental and social issues - Category FI-2 |
This is an FI type 2 project according to IFC's Environmental and Social Review Procedure. The Bank will be required to designate individuals who will have responsibility for environmental issues and reviews and who will attend environmental training; submit a proposed environmental management plan; implement an environmental management system to ensure that its investments comply with applicable standards, including IFC's exclusion list and for Category A investments, World Bank Group environmental, health and safety guidelines; obtain IFC's prior approval for any investment in a Category A project and comply with associated IFC requirements; and submit annual environmental performance reports.
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| To contact the project company, please write to: |
Mr. Ikram I. Ibragimov
Chairman of the Board
Hamkor Bank
85, Bobur ave.
Andijan City, 710000
Republic of Uzbekistan
Phone: (3742) 247 039
Fax: (3742) 254 922 |
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