YEREVAN, October 10. /ARKA/. The European Fund for Southeast Europe (EFSE) said it has once again teamed up with long-time partner ARARATBANK to drive local business growth in Armenia.
‘By providing a multi-currency senior loan equivalent to USD 10 million, the fund is supporting the bank in offering tailored financial products that meet the needs of micro and small enterprises, thereby strengthening the development of this important sector while securing and creating jobs in the country.,’ it said in a news release.
It said this next chapter in the partners’ ongoing collaboration was confirmed at an EFSE signing ceremony celebrating the Power of Local Currency Financing in Chișinău, Moldova, on Thursday.
ARARATBANK has been a key EFSE partner in Armenia since 2010. The bank’s solid positioning, extensive branch network, and strategic focus on the small business market have enabled ARARATBANK and EFSE to generate more than EUR 58 million in financing for micro and small enterprises so far. The new investment will continue this momentum: Comprised of both a USD portion and a local currency facility, the loan will contribute to the bank’s ability to flexibly cater to the specific financing needs of entrepreneurs, eliminating direct exposure to currency risk for these unhedged businesses.
EFSE Board Chairman Christoph Tiskens said: “Partners like ARARATBANK are essential to helping EFSE pursue its mission of expanding access to sustainable finance for local businesses. By facilitating loans in local currency, we are, together, investing in the stability and secure growth of small businesses, which are one of the main drivers of the country’s economy.”
“It should be noted that during the nine years of cooperation ARARATBANK financed over 1,500 business projects in different sectors, creating an added value for borrowers as well as for the Armenian economy,” said Ashot Osipyan, Chairman of the Executive Board of ARARATBANK. According to him, signing a new contract in local currency will keep the beneficiaries of the project away from foreign exchange risks, which in its turn will boost the profitability and competitiveness of the companies in the local market. “I am glad about the signing of this contract, which reaffirms the mutual trust and continued cooperation between our institutions,” said Osipyan.
The European Fund for Southeast Europe aims to foster economic development and prosperity in the Southeast Europe region and in the European Eastern Neighborhood region through the sustainable provision of additional development finance, notably to micro and small enterprises (MSEs) and private households, via qualified financial institutions.
In pursuing its development goal, the fund observes principles of sustainability and additionality, combining development and market orientations.
Araratbank OJSC is one of the leading Armenian banks, providing the latest and highest quality banking services to individuals and legal entities. Araratbank has 61 branches throughout the country. It lends actively to small and medium-sized businesses and cooperates with 14 international financial organizations. -0-
