ProCredit Bank Moldova

complete

Setting up a greenfield financial institution specialising in providing financial services to micro and small enterprises in Moldova. By providing reliable access to financial services to micro and small enterprises the project will not only give direct support to the development of the private sector but also have a strong demonstration effect on local banks which could encourage them to enter this market segment. The transition impact is expected to be significant as MEC provides continuous support to micro and small enterprises that would otherwise have little or no access to formal sector finance. MEC will also support the development of the Moldovan financial sector by operating as a best practice institution committed to the principles of complete transparency and strong corporate governance. MEC is a closed joint-stock company founded in December 1999 which is devoted to providing financial services to micro and small enterprises. It is currently owned by IMI, IFC, Western NIS Enterprise Fund, DOEN Foundation and EBRD AG with paid-in equity capital of US$ 650,000. MEC will be converted into a bank at a later stage. Initial equity investment of US$ 100,000 (€ 110,000) and US$ 900,000 (€ 1 million) as quasi-equity in form of subordinated loan. US$ 10.9 million (€ 12 million). MEC will carry out its operations in accordance with the EBRD’s "Environmental Procedures for Small and Micro Loans". In implementing these procedures, it will require its borrowers to comply, at a minimum, with national/local environmental, health, safety and public consultation requirements. Technical cooperation funding will be used to partially cover MEC’s start-up costs, including training of loan officers and senior management for up to 2 years.