Ulaanbaatar, Mongolia, March 26, 2013—
IFC, a member of the World Bank Group, on Tuesday agreed to provide
$20 million to Khan Bank LLC, Mongolia’s largest bank by assets, to increase
lending to small and medium enterprises.
IFC’s five-year senior loan will help
the bank make loans to 5,000 additional small and medium enterprises over
the next five years.
“IFC’s investment will support our
efforts to satisfy increasing financing needs among a rapidly growing Mongolian
economy,” said Khan Bank’s Chairman Mr. Hideo Sawada. “IFC adds
value to our business, not only through its financing, but also through
its global standing as a leading multilateral lender. Working with IFC
boosts our ability to provide financial services to an increasing number
of smaller businesses and improves confidence in the banking sector.”
Mongolia’s economy is undergoing a
major transformation driven by its mining industry, but financing for smaller
businesses remains critical for the Mongolian economy to make the most
of these opportunities. By supporting smaller enterprises, IFC helps Mongolia’s
economic diversification and job creation.
IFC is the third-largest shareholder
in Khan Bank, owning a 9.3 percent stake and previously provided financing
and advisory services to support the bank’s assessment of the small and
medium enterprise customer market segment and to strengthen its capital
position. Since becoming an IFC client in 2004, Khan Bank has grown to
become the largest bank in Mongolia by assets and branch network, reaching
about 80 percent of Mongolian households.
The signing coincides with the 10th
anniversary of Khan Bank’s privatization. During the last decade the bank
has provided a solid foundation for Mongolia’s future growth.
“While international capital markets
have been volatile, Mongolia's economy is growing at a remarkable rate,”
said Sérgio Pimenta, IFC’s Director for East Asia and the Pacific. “We
are confident that Khan Bank will continue to play an important role in
helping to spread the benefits of Mongolia’s growth to the broader society
by helping small and medium entrepreneurs to grow and create jobs.”
IFC, a member of the World Bank Group,
is the largest global development institution focused exclusively on the
private sector. We help developing countries achieve sustainable growth
by financing investment, mobilizing capital in international financial
markets, and providing advisory services to businesses and governments.
In FY12, our investments reached an all-time high of more than $20 billion,
leveraging the power of the private sector to create jobs, spark innovation,
and tackle the world’s most pressing development challenges. For more
information, visit www.ifc.org.