Istanbul, Turkey, May 11, 2016—
IFC, a member of the World Bank Group,
is providing $60 million to Burgan Bank, the subsidiary bank of Kuwait’s
Burgan Bank Group in Turkey, to expand access to finance for small and
medium enterprises (SMEs), the driving source of growth and job creation
in the country.
IFC’s financing comprises a six-year $40 million loan on its own account
and a $20 million loan through the IFC Managed Co-Lending Portfolio Program,
a syndication program that allows institutional investors to passively
participate in IFC’s senior loan portfolio.
Murat DinÁ, Burgan Bank CEO said: “Our aim is to always understand and
analyze the needs of our customers while developing our products and services.
This partnership with IFC will help strengthen our position in Turkey’s
financial system, and create a long-term funding source for the bank to
provide finance to our customers, especially SMEs. We are continuing to
work on diversifying our funding base and this transaction is another step
in reaching our targets.”
SMEs make up about 90 percent of Turkey’s economic activity, but receive
only 27 percent of total bank loans, despite this. Access to finance is
still one of the biggest constraints on business growth for SMEs.
“There is broad recognition that SME growth will be a central driver of
economic growth over the next decade,” said Manuel Reyes-Retana, IFC Regional
Industry Head of Financial Institutions Group in Europe, Middle East, and
North Africa. “SMEs form the backbone of the Turkish economy but often
struggle to reach their potential. Financial institutions like Burgan Bank
can play a significant role in expanding resources to these businesses
so they can innovate, create jobs and tap into global markets.”
IFC has supported private sector development in Turkey for 50 years. Turkey
is the third-largest country exposure for IFC globally. IFC has invested
$4 billion in private sector projects in Turkey thus far, in line with
the World Bank Group’s Turkey Country Partnership Strategy for fiscal
years 2012 to 2016.
IFC, a member of the World Bank Group, is the largest global development
institution focused on the private sector in emerging markets. Working
with more than 2,000 businesses worldwide, we use our capital, expertise,
and influence, to create opportunity where it’s needed most. In FY15,
our long-term investments in developing countries rose to nearly $18 billion,
helping the private sector play an essential role in the global effort
to end extreme poverty and boost shared prosperity. For more information,