Baku, Azerbaijan, October 2, 2019 —IFC, a member of the World Bank Group, has signed an agreement with Azerbaijan’s Bank Respublika to enable it to better manage its currency risk, helping ease access to local currency finance for local businesses and smaller firms, in particular.
Under the terms of the agreement, IFC and Bank Respublika will execute cross-currency swap transactions under an International Swaps and Derivatives Association (ISDA) Master Agreement, a standard document used to govern over-the-counter derivative transactions. That will allow the bank to hedge its USD-denominated funding and better manage its assets and liabilities.
“As one of the leaders in the Azerbaijani financial market in micro, small and medium enterprises (MSMEs), Bank Respublika continues to support its customers, encouraging them to contribute to Azerbaijan’s economic growth,” said Tariyel Ismayilov, CEO of Bank Respublika. “This agreement with IFC will enable us to expand affordable local currency financing to our customers.”
Through engaging in cross-currency swap transactions, the bank will improve access to long-term finance for its clients, helping local businesses grow and create jobs.
“We aim to continue helping Azerbaijan unlock the power of its private sector, and this agreement with our long-standing partner Bank Respublika is part of that strategy,” said Hans Peter Lankes, IFC’s Vice President of Economics and Private Sector Development. “It is also aligned with Azerbaijan’s efforts to diversify its economy by helping to enable the growth of businesses in the non-oil sector.”
Azerbaijan became a member of IFC in 1995. Since then, IFC has invested around $473 million, including $73 million in mobilization, financing 56 projects across a range of sectors, including financial services, infrastructure, and manufacturing. In addition, IFC has supported around $100 million in trade through its trade finance program and provided $250 million for the Baku-Tbilisi-Ceyhan pipeline. IFC has also implemented a range of advisory projects aimed at encouraging private sector growth.
About IFC
IFC—a sister organization of the World Bank and member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work with more than 2,000 businesses worldwide, using our capital, expertise, and influence to create markets and opportunities where they are needed most. In fiscal year 2019, we delivered more than $19 billion in long-term financing for developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity. For more information, visit www.ifc.org
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