The European Investment Bank (EIB) has lent EUR 30m to TBC Bank, the largest bank in Georgia, in order to broaden the access to finance of Georgian small and medium-sized enterprises (SMEs), which represent more than 90% of companies active in the country. The EIB funds will be provided in the framework of the European Union’s EU4Business initiative, designed to support SMEs in the six Eastern Partnership countries (Armenia, Azerbaijan, Belarus, Georgia, Moldova and Ukraine). Around 600 Georgian SMEs are expected to benefit from the loan.
EIB Vice-President Vazil Hudák commented: “thanks to the EIB support, Georgian SMEs will improve their access to longer term finance, which is a prerequisite for their growth and competitiveness. Our fourth loan with TBC Bank is expected to support the development of approximately 600 small and medium size companies, by giving them better access to finance. We hope this will promote job creation and foster the general development of Georgia’s economy”.
“We are proud to have built such a successful relationship with the EIB, TBC Bank’s long standing partner. This is already the fourth transaction we have successfully accomplished since the launch of our partnership in 2012, which is a testament to the truly efficient working relationship our respective organisations have formed. This facility will help TBC Bank to further strengthen its leading position in the Georgian small and medium-sized enterprises (SME) segment,” stated Vakhtang Butskhrikidze, CEO of TBC Bank.
This is the fourth EIB Group operation with TBC Bank and builds upon the fruitful cooperation of the EU bank with this Georgian institution. Since 2011, TBC Bank has on-lent EIB funds for SMEs totalling EUR 85m.
The EIB loan can be combined with portfolio guarantees supporting SMEs which were extended to TBC Bank last year through two instruments also promoted under the EU4Business Initiative: the InnovFin portfolio guarantee, supporting innovative SMEs, and the DCFTA Initiative East portfolio guarantee, unlocking additional financing for small businesses. The overall objective is to allow TBC Bank to extend financing on favourable terms to a broader group of small and medium-sized companies that would otherwise have limited access to the bank’s lending.
In these operations, the EIB has joined forces with the European Union to strengthen economic development in the countries that have signed Association Agreements with the EU – namely Georgia, Moldova and Ukraine – by providing financial and technical support targeted at SMEs in these three countries. The EU supports private sector development in the Eastern Partnership countries by enhancing access to finance for SMEs, improving the business environment and providing advisory services to local businesses.
