Armenian Central Bank subsidiary Small and Medium Business Credit Support CJSC increases equity investment in EFSE Armenia Local Currency Facility to support small and medium enterprises

(PresseBox) ( Frankfurt and Yerevan, )
European Fund for Southeast Europe (EFSE) received additional AMD 300 million (approximately EUR 0.5 million) capital from Small and Medium Business Credit Support CJSC (SMBCS), a subsidiary of the Central Bank of Armenia to strengthen the Armenia Local Currency Facility.

The Facility was created as a separate investment window within EFSE in December 2011, when the SMBCS invested AMD 875 million to support and promote local currency lending to micro and small enterprises (MSEs) in the country. With this investment, the total contribution by the SMBCS to EFSE will reach AMD 1.5 billion (approximately EUR 2.6 million). As of end of the second quarter 2014, the EFSE will have EUR 43.9 million in outstanding investments in Armenia. This in an increase of 11,7% since year‐end.

"In the Central Bank of Armenia, we have found a strong promoter of responsible finance. Through innovative and effective means, CBA contributes to promoting local currency financing for MSEs and thereby mitigates the foreign currency risks," says Monika Beck, Chairperson of the Board of EFSE. "Therefore we highly welcome this additional investment into the Fund as a sign of confidence in the EFSE and further contribution to the stability and development of the banking sector in Armenia."

Arthur Javadyan, Governor of the Central Bank of Armenia, said: "We are happy to see that EFSE portfolio is continuously growing both in value and in the number of partner lending institutions in Armenia and the Fund is becoming one of the major sources of SME financing. Further investment of the CBA's subsidiary in the EFSE's capital will give Armenian lending institutions a possibility to obtain additional funding from EFSE's local currency window for SME financing. We hope EFSE in its turn will leverage up the invested finances and contribute to the further growth of its local currency investments in Armenia. SMEs are crucial players for the Armenian economy. Different opportunities of attracting long term funding will enable lending institutions to better serve the financial needs of SMEs helping them to grow, to generate additional income, to create employment and foster the development of the country."

About Small and Medium Business Credit Support CJSC

Small and Medium Business Credit Support CJSC (SMBCS) was incorporated on 28 December in 2010 to support small and medium enterprise (SME) financing in Armenia in cooperation with foreign specialised financial institutions. The main purpose of SMBCS is to establish cooperation with international financial organisations specialised in SME lending, and to find ways of channelling funds from international markets to Armenian financial institutions. SMBCS is a wholly owned subsidiary of the Central Bank of the Republic of Armenia.
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