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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 | 20957 |
| Project name | MFBSerbia Loan 2 |
| Country | Serbia and Montenegro |
| Sector | Finance & Insurance |
| Department | Global Financial Markets Group |
| Company name | ProCredit Bank Serbia |
| Environmental category | U |
| Date SPI disclosed | March 31, 2003 |
| Projected board date | May 30, 2003 |
| Status | Active |
| Previous Events | Invested: July 21, 2003
Signed: June 20, 2003
Approved: June 16, 2003 |
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| Description of company and purpose of project |
IFC proposes to provide to Microfinance Bank (MFB, Bank, Borrower), a commercial bank established as a closed joint stock company in Belgrade, Serbia and Montenegro, a Loan for IFC’s own account of up to eight million euro (EUR 8,000,000) for on-lending by the Borrower to micro and small enterprises in Serbia. The funds would be for the exclusive use of MFB to on-lend to Eligible Sub-Borrowers.
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| Project sponsor and major shareholders of project company |
The Microfinance Bank is owned by IFC, Commerzbank AG (Germany), EBRD, FMO (Netherlands), IMI (Germany) and KfW (Germany) each in the amount of $2,000,000 for a 16.67% share in the common equity of the bank. IMI, in which IFC has a 13.64% share, is a Frankfurt-based investment company specializing in microfinance.
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| Total project cost and proposed IFC investment |
The total project cost is up to EUR 8,000,000 (but not to exceed the equivalent of $8,000,000 at commitment) consisting of two tranches:
Tranche A (a regular tranche) in the amount of up to EUR 4,000,000;
Tranche B (a stand-by tranche) in the amount of up to EUR 4,000,000.
The use of proceeds is to provide sub-loans to eligible sub-borrowers. Sub-loans repaid and/or prepaid to be used solely for sub-loans to eligible sub-borrowers in accordance with the terms of the loan.
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| Location of project and description of site |
The Bank is headquartered in Belgrade and has 8 branches around the country.
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| Project Development Impact and IFC's Role |
Since its inception in 2001, MFB has had strong developmental impact by rapidly expanding its services to micro and small entrepreneurs in Serbia and Montenegro. The developmental impact of commercially-run micro and small business credit programs on post-conflict transition economy populations with little or no access to formal credit institutions has been well-demonstrated by IFC's more mature microfinance investments in several countries.
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| Environmental and social issues - Category U |
MFB is a category FI Type 1 project according to IFC’s environmental and social review procedure. IMI and project technical partner IPC have developed an environmental management framework to ensure that financial institutions in which IMI invests and IPC manage have appropriate Environmental Management Systems (EMS). IFC's Environment Division has approved this environmental framework. Under the framework, IPC, IMI and MFBY has developed an EMS, requiring activities financed to comply with the applicable environmental, health and safety legislation and standards of Serbia & Montenegro and IFC’s Microfinance Exclusion List. Implementation of the EMS may involve an orientation in cleaner production and a focus on clients presenting the greatest environmental risk and opportunities. MFB provides an annual environmental performance report to IMI/IPC.
To view the environmental documents for this project, click here |
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| Location of environmental documents in locally affected community |
Bank’s headquarters in Belgrade.
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| To contact the project company, please write to: |
Mr. Christoph Freytag, General Manager
MFB Banka,
Narodnih Heroja 43/III,
11070 Belgrade, Serbia and Montenegro
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