Baku, Azerbaijan, October 30, 2002—The
International Finance Corporation (IFC), the private-sector development
arm of the World Bank Group, has sponsored the establishment of the first
commercial bank in Azerbaijan dedicated to serving micro and small enterprises.
Micro Finance Bank Azerbaijan (MBFA), which opened its doors today,
is a joint venture of IFC, the European Bank for Reconstruction and Development
(EBRD), the Black Sea Trade and Development Bank (BSTDB), and LFS Financial
IFC has invested US$1.75 million in Micro Finance Bank Azerbaijan for a
35 percent shareholding. The bank, which is based in Baku with a
staff of 25 and is expected to open branches in the major regional centers
of Sumgait and Ganja next year, has equity capital of $5 million.
“IFC is pleased to support a pioneer financial institution dedicated to
micro and small entrepreneurs in Azerbaijan,” said Khosrow Zamani, Director
of IFC's Southern Europe and Central Asia Department. “We are committed
to encouraging the growth of strong private sector enterprises in Azerbaijan
and investing in the local financial sector is critical to achieve this
aim. The financial services offered by Micro Finance Bank Azerbaijan
will give ordinary people the means to provide for their own livelihoods.”
Mr. Zamani emphasized the importance of strong financial intermediaries
to private sector development.
IFC’s investment will introduce commercially-oriented microfinance techniques
in Azerbaijan and help to bolster confidence in the country’s banking
system. IFC believes that well-managed microfinance institutions
can be viable and provide substantial and sustainable increases in
the volume and scope of financial services available to microenterpreneurs
and small enterprises.
IFC’s mission 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, and provides technical
assistance and advice to governments and businesses. Since its founding
in 1956 through FY02, IFC has committed more than $34 billion of its own
funds and arranged $21 billion in syndications for 2,825 companies in 140
developing countries. IFC’s worldwide committed portfolio as of
FY02 was $15.1 billion for its own account and $6.5 billion held for participants
in loan syndications.