South Region EQ

completed

_x000C_IFC’s Financial Markets strategy in Russia places a high priority on improving access to finance in non-urban areas and on improving the stability of the banking system by assisting in the consolidation of a highly fragmented sector and by reducing the concentration of state-owned banks. As a result, IFC looks to support second- and third-tier banks in regions that are under-served by the banking system. The proposed project consists of an equity investment of up to $1.5 million in Bank “Yuzhniy Region” (“Southern Region Bank”, or “SRB”), a medium-size bank located in Rostov-on-Don (a frontier region), to purchase up to 20% of the voting shares of SRB. The branch network of SRB comprises 2 branches and 2 points of sale. The Bank is a member of the deposit insurance system. The Bank’s primary business lines are corporate and retail lending, with focus on SME financing. Primary funding for the Bank is received through corporate and retail deposits. The Bank’s deposit base comprises over 2,600 retail and 1,500 corporate clients. The Bank’s loan portfolio has around 30 corporate and over 520 retail borrowers and is adequately diversified in terms of industry exposures.