WASHINGTON D.C./DAMASCUS, January 7, 2004—The
International Finance Corporation, the private sector arm of the World
Bank Group, today formalized a $3 million equity investment for a 10 percent
shareholding in Bank of Syria and Overseas (BSO), helping create Syria’s
first private sector bank since nationalization of the system in 1961.
IFC’s equity stake in BSO represents its first investment in a Syrian
financial intermediary and underlines IFC’s commitment to helping the
economy become more conducive to private sector investments. Peter Woicke,
IFC Executive Vice President, noted at the BSO inauguration ceremony in
Damascus, Syria, that “by promoting the country’s first private sector
banking institution, IFC will assist in Syria’s economic transition to
a more open and liberalized financial system, driven by greater private
BSO aims to provide modern commercial banking products that have not been
available to local private retail and corporate firms, enhance competition
in the banking system by creating a model of “best practices” for current
and future commercial banks in Syria to follow, and unleash the full growth
potential of domestic private companies – the bedrock of the Syrian economy.
Total capitalization of BSO amounts to $30 million, with BLOM Bank of Lebanon
the anchor investor in BSO, holding a 39 percent equity stake and exercising
managerial control as well. Other shareholders in BSO include a group of
prominent Syrian businessmen (13 percent), led by Dr. Rateb Shallah, head
of the Federation of Syrian Chambers of Commerce and Industry, and 38 percent
held by Syrian citizens through an initial public offering.
The Government of France provided funding, through IFC's Technical Assistance
Trust Fund program, for the evaluation of the strength and weaknesses of
Syria’s financial system, including banks, insurance company, and other
long-term savings institutions. The technical assistance also included
the review of the legal and regulatory framework in the country and the
identification of the material impediments in the development of the banking
The mission of IFC (www.ifc.org)
is to promote sustainable private sector investment in developing countries
helping to reduce poverty and improve people’s lives. IFC finances private
sector investments in the developing world, mobilizes capital in the international
financial markets, helps clients improve social and environmental sustainability,
and provides technical assistance and advice to governments and businesses.
From its founding in 1956 through FY03, IFC has committed more than $37
billion of its own funds and arranged $22 billion in syndications for 2,990
companies in 140 developing countries. IFC’s worldwide committed portfolio
as of FY03 was $16.8 billion for its own account and $6.6 billion held
for participants in loan syndications.