The IFC, the private sector arm of the World Bank Group, will grant Locko Bank, which specializes in crediting small and medium-sized businesses, a 300 million ruble loan. The IFC will also open a $5 million guaranteed credit line to finance international foreign trade operations, a joint news release said.
The IFC's Director for Central and Eastern Europe, Edward Nassim, said that medium-sized independent banks with Russian capital were a priority for the IFC's investment into the country's financial institutions.
He said the IFC welcomed Locko Bank's intention to continue working with small and medium-sized enterprises (SME) and expand its activity beyond Moscow. The IFC has also expressed its approval of the bank's plans to improve transparency.
In turn, Locko Bank CEO Dmitry Kryukov said financing from the IFC would enable the bank to expand its network of regional offices, and offer clients more affordable terms. "This will stimulate the development of small businesses and Russia's economy as a whole," he said.
Locko Bank was registered in February 1994. As of April 1, 2006, the bank's assets stood at 9.87 billion rubles ($356 million), and its equity capital at 1.6 billion rubles ($58 million).
Since 1993, the IFC has invested more than $2.9 billion in Russia, including some $527 mln in the form of syndicated loans, in more than 110 projects in different segments of Russia's economy.
In 2005, the IFC invested $832 million in Russia. The company's investment portfolio in Russia is $1.8 billion.
