The FINANCIAL -- IFC, a member of the World Bank Group, has provided a RON150 million (approximately $38.5 million equivalent) loan to UniCredit Leasing Corporation to help finance small and medium enterprises (SMEs), so they can grow their businesses and generate new employment.
The agreement will allow UniCredit Leasing, the market leader in Romania’s leasing sector, to extend its reach to smaller companies that need to upgrade their fixed term assets. UniCredit Leasing is a subsidiary of UniCredit Bank S.A., a long-term IFC client. The loan is also part of IFC’s strategy to work with banks and financial institutions across the region to strengthen their lending capacity to underserved sectors, according to IFC.
“UniCredit Leasing Corporation has an ongoing strategy of supporting smaller companies in Romania,” said Mircea Cotiga, CEO of UniCredit Leasing. “With this new loan, we enforce our long-term commitment to encouraging this segment. In the months to come, we will focus on healthy sustainable growth in the local market and further diversifying our SME portfolio.”
This is IFC’s first local currency loan to a leasing company, to help the sustainable development of Romania’s growing leasing market, while eliminating cross-currency mismatches. Given their numerous financial constraints, leasing is an attractive alternative for SMEs, especially for small and young companies unable to obtain bank loans because of their lack of credit history.
“Leasing companies are essential to drive IFC’s SME programs across Europe and Central Asia,” said Kudret Akgun, IFC EMENA Regional Manager for the Financial Institutions Group. “With this agreement with UniCredit Leasing Corporation, we are aiming to reach smaller and mid-size companies in Romania and increase their access to finance, enabling their future growth.”