Working with Financial Intermediaries in the Caucasus

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Working with Financial Intermediaries in the
Caucasus
Banking Finance Caucasus Conference Tbilisi,
May 17-18, 2007 Presented by Nejdet Sarisozen,
Director, Financial Institutions
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BSTDB

• Establishment of the Bank
• Shareholders and Countries of Operation
• Albania, Armenia, Azerbaijan, Bulgaria, Georgia,
  Greece, Moldova, Romania, Russia, Turkey, and
  Ukraine
• Multilateral Financial Institution
• Moodys Rating
• - Baa1 long-term issuer rating
• - Prime-2 short-term issuer rating
• - Outlook on the ratings is stable.

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BSTDBs Mandate

• Facilitate economic development in Member
  Countries
• Promote regional stability and cooperation by
  supporting intra-regional trade

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BSTDB Financing Objectives

• Promote intra-regional trade and foster regional
  cooperation
• Strengthen export potential of member countries
• Strengthen the capacity of local financial
  institutions
• Contribute to SME development and employment
  generation

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Main Products

• TRADE FINANCE
• Pre-Export Finance
• Multiple/Single Buyer Credit
• Combined Trade Finance Facility
• Leasing facility
• Guarantees
• SME FINANCE
• Medium-term SME loan facilities
• Leasing facilities
• SME loan portfolio refinancing

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Selecting Financial Intermediaries

• MAIN SELECTION CRITERIA
• Transparent ownership structure
• Sound asset quality and financial ratios
• Experienced management team
• Active in SME and trade finance
• Customer outreach and branches

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Selecting Financial Intermediaries

• SELECTION PROCEDURE
• Preliminary eligibility review
• Due diligence
• Term Sheet
• Credit Committee approval
• Board approval
• Loan Agreement
• Disbursement

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BSTDBs Financial Intermediaries in Caucasus
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ACBA-Credit Agricole Bank

• Majority owned by Credit Agricole France
• BSTDBs client for Trade Finance Facility since
  April 2006
• Revolving limit of US 3 million, disbursements
  up to 360 days
• Facility to finance exports from Armenia and
  imports from other BSTDB member countries

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Ineco Bank, Armenia

• New financial intermediary from January 2007
• Revolving trade finance line to finance Armenian
  exports and imports from the region
• Amount US 3 million, disbursements up to 360 days

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International Bank of Azerbaijan

• First financial intermediary in Azerbaijan since
  2002
• Multiple Buyer Credit Facility
• Amount USD 6.5 million, 3 years
• Financing of imports from member countries
• Disbursed USD 14.4 million (revolving)
• Azeri Glass Factory loan EUR 5 M.

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Micro Finance Bank of Azerbaijan

• Established by IFIs, including BSTDB with 20
  share
• Micro and SME Finance Credit Line
• US 3 million, 3 years
• Sub-loans up to US 50,000 to eligible Micro and
  SME enterprises

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Unibank, Azerbaijan

• BSTDBs client since 2005
• Revolving Trade Finance Facility
• Amount USD 3 million, 360 days
• Financing of imports from and exports to member
  countries
• Facility can be used to finance exports from
  Azerbaijan or imports from member countries
• Single transaction amount can be up to 100 of
  the facility

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Bank Respublika, Azerbaijan

• BSTDBs client since 2006
• Revolving Trade Finance Facility
• Amount 2.3 million, 360 days
• Facility can be used to finance exports from
  Azerbaijan or imports from member countries
• Single transaction amount can be up to 100 of
  the facility

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ProCredit Bank, Georgia

• Financing of Georgian small and medium
  enterprises (SME)
• Fixed assets and working capital investments for
  eligible SMEs
• SME I US 5m fully utilised, repaid
• SME II US 6m fully utilised

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TBC Bank, Georgia

• Client since 2002 for trade finance
• US 5m SME loan, 3 years fully utilised
• US 5m Revolving Trade Finance loan,
  disbursements up to 360 days
• Financing Georgian exports and regional imports

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VTB Georgia (UGB)

• Client since 2006, former United Georgian Bank.
• Revolving Trade Finance Facility
• US 3m, disbursements up to 360 days

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Advantages of Working with BSTDB

• Long-term standing partner of local Financial
  Intermediaries
• Ability and willingness to take risks in all
  Member Countries due to its regional expertise
• Capacity to provide short- and medium-term
  funding in all Member Countries
• Broad range of products

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Co-Financing with BSTDB

• Local Commercial Banks, International Banks,
  ECAs, IFIs
• Risk-Sharing and Co-financing of trade
  transactions of companies in Member Countries
• Participation in Syndicated Trade-Related Loans
• FOCUS Import transactions between Member
  Countries and export transactions to all countries

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Thank You !

• www.bstdb.org