YEREVAN, July 17. /ARKA/. As commercial funding for small businesses in the Caucasus remains scarce, the EBRD is making a new step to support financial institutions that provide loans to micro, small and medium-sized enterprises in local currency.

The EBRD is arranging a senior syndicated loan to ACBA Credit Agricole Bank (ACBA-CA) to expand the bank’s MSME lending, in urban as well as rural areas, where there is strong demand for longer-term, local currency funding.

The loan in Armenian drams to the equivalent of US$ 30 million will consist of US$ 15 million equivalent for the EBRD’s own account, and the remaining US$ 15 million equivalent will be syndicated to FMO, the Netherlands Development Finance Company, one of the world’s largest development finance institutions.

The project will provide longer term MSME funding in local currency in a market dominated by FX denominated loans. It will also demonstrate that Armenian financial institutions can access the syndicated loan market despite current market volatility.

ACBA-Credit Agricole is the largest bank in Armenia by total assets and capital. It is a leading provider of finance to farmers and agribusinesses in the country and a significant player in the MSME segment with a well-established branch network and franchise.

Since the beginning of its operations in Armenia, the EBRD has invested about US$ 650 million in the country in about 110 projects, mobilising almost the same amount from other sources of financing. -0-