Press Releases
print

Increasing Access to Finance for Small Businesses in Lebanon: IFC Makes Good on its Promise to Help Rebuild the Financial Sector


In Beirut:
Julia Brickell
Phone +961 1 987-800, +961 3 755-282
E-mail: jbrickell@ifc.org

In Cairo:
Riham Mustafa
Phone: +20 22 461 9140
E-mail: rmustafa@ifc.org


Beirut, June 27, 2007 — IFC, the private sector arm of the World Bank Group, today signed two agreements with the Bank of Beirut and Credit Libanais as part of its overall strategy to extend financing to banking intermediaries, helping the private sector and small and medium enterprises recover from the recent conflict in Lebanon.

IFC’s risk-sharing facility of up to $25 million will help the Bank of Beirut increase access to finance for the private sector, particularly for smaller businesses. A 15 million credit line investment in Credit Libanais, one of the country’s largest banks, will help the bank reach more people through diverse services. Through the agreements, IFC will help provide term funding to private sector enterprises that are recovering from the conflict.

“With the economic challenges in Lebanon, private banks may reduce their loan exposures at the expense of small and medium enterprises, which could lead to job loss and an increase in the poverty rate.  IFC’s investment will help increase financing to SMEs, an important engine of growth and job creation,” said Michael Essex, IFC Director for Middle East and North Africa.

Strengthening Lebanon’s private sector is a key priority for IFC. The Corporation is channeling up to $200 million through banks to increase access to finance for private sector companies and individuals who are affected by the conflict. On a recent visit to Lebanon, Lars Thunell, IFC’s Executive Vice President and CEO, signed agreements to provide financing to Blom Bank and Fransabank. He also signed an advisory services package to scale up Kafalat, a local company whose guarantees help smaller businesses obtain commercial bank loans.

About IFC
IFC, the private sector arm of the World Bank Group, promotes open and competitive markets in developing countries.  IFC supports sustainable private sector companies and other partners in generating productive jobs and delivering basic services, so that people have opportunities to escape poverty and improve their lives. Through FY06, IFC Financial Products has committed more than $56 billion in funding for private sector investments and mobilized an additional $25 billion in syndications for 3,531 companies in 140 developing countries. IFC Advisory Services and donor partners have provided more than $1 billion in program support to build small enterprises, to accelerate private participation in infrastructure, to improve the business enabling environment, to increase access to finance, and to strengthen environmental and social sustainability. For more information, please visit www.ifc.org.