The FINANCIAL — The European Bank for Reconstruction and Development signed a subscription agreement to acquire a minority equity stake in a leading Belarus private lender, JSC Reconversion and Development Bank (RDB).
EBRD will acquire a 25 percent plus one share stake in this fast-growing bank in what is only the third EBRD equity investment in the country’s banking system, 75 percent of which is state-owned.
The investment will contribute to strengthening Reconversion and Development Bank’s balance sheet, as well as set in motion an agreed institutional building programme aimed at improving its businesses processes, efficiency and corporate governance. It will also support the development of RDB’s retail, small and microfinance funding programmes.
This is an important milestone which will eventually make it easier for this bank to access international capital markets and which will meanwhile unlock long-term EBRD funding ear-marked for financing micro, small and medium-sized businesses, said the EBRD’s Head of Office in Belarus, Valdas Vitkauskas.
A $3 million EBRD loan, previously made to Reconversion and Development Bank to support the development lending to micro, small and medium enterprises, has been successfully disbursed to over 100 RDB clients.
Reconversion and Development Bank was founded in 1994. At the end of second quarter 2008, it ranked 18th among the country’s 27 banks as measured by total assets and 19th by shareholders’ equity.
The EBRD recently sold its remaining shares in its first equity stake in Belarus’s banking system, Priorbank, to that bank’s strategic investor, Austria’s RZB group. The EBRD is also one of the eight founding shareholders of the Belarus Small Business Bank which started its operations in Minsk earlier this week.
Discussion about this post