Absolute Bank Term Loan

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Loan to Absolute Bank for on-lending to the bank's customers for eligible sub-projects. The operation will enable Absolute Bank to provide medium-term credit resources to the private sector enterprises in Georgia. This is expected to increase investment capacity in the Georgian economy and to encourage growth of employment and production in the country. The operation is expected to strengthen a local financial intermediary, which will result in greater capacity to offer credit and other banking services to the local economy on the basis of lending criteria and standards which are of international quality. Commercial bank established in Georgia with 60 per cent of US investors and 40 per cent participation of various Georgian entities. Since starting operations in February 1995, Absolute Bank has attracted a good deposit base, built a good loan portfolio, and acquired a commercial reputation as one of the leading financial institutions in the country. Bank-to-bank credit line of US$ 5 million (ECU 3.97 million equivalent) disbursable in two unequal tranches. US$ 5 million (ECU 3.97 million equivalent). C/0: The project does not require an environmental analysis or an environmental audit. Absolute Bank will follow the EBRD's "Environmental Procedures for Local Banks" in relation to all sub-loans. In implementing these procedures, Absolute Bank will assess potential environmental issues associated with sub-projects, which are required to comply with local/national health and safety, environmental and public consultation requirements. Absolute Bank will report annually to the EBRD on environmental issues related to the loan. Project preparation assistance was provided through an ECU 200,000 grant.