The International Finance Corporation (IFC), a member of the US-based World Bank Group that offers financial services to businesses and governments in developing countries with the aim of increasing economic growth, recently announced that it will loan USD 7 million to TuranBank Open Joint Stock Company (TuranBank), a retail and corporate bank in Azerbaijan. The proceeds of the loan will be on-lent to micro-, small and medium-sized enterprises (MSMEs) and low-income entrepreneurs working in rural areas of the country. It is anticipated that the funding will allow the beneficiaries to grow their business ventures and create jobs in Azerbaijan.
Mr Nazim Sadigov, the chairman of the management board of TuranBank, said that “with support from IFC, the bank’s MSME lending capacity will expand, contributing to sustainable development and helping reduce the country’s dependence on the oil and gas sector”[1].
As of December 31, 2013, TuranBank reported total assets of AZN 244.3 million (USD 312 million), a loan portfolio of AZN 177.6 million (USD 226.8 million) and deposits of AZN 108.2 million (USD 138.2 million.) The cooperation between IFC and TuranBank dates to 2009, when IFC advised the organization on corporate governance and risk management practices. In 2011, TuranBank received a loan of USD 7 million for on-lending to small and medium-sized enterprises from IFC. IFC has 184 member countries and reported total assets of USD 77.5 billion as of fiscal year-end 2013. In Azerbaijan, IFC has invested USD 414 million in the financial services, infrastructure and manufacturing sectors between 1995 and 2014.
By Alíz Crowley, Research Associate
About TuranBank
TuranBank Open Joint Stock Company (formerly known as: Turan Commercial Bank) is a retail and corporate bank that was founded in 1992 and is based in Baku, Azerbaijan. As of 2014, TuranBank offers credit, voluntary savings and fund transfer and currency exchange services through 14 branches in the country. As of December 31, 2013, TuranBank reported total assets of AZN 244.3 million (USD 312 million), a loan portfolio of AZN 177.6 million (USD 226.8 million) and deposits of AZN 108.2 million (USD 138.2 million).
About International Finance Corporation
The International Finance Corporation (IFC), a US-based multilateral development bank and member of the World Bank Group, offers loans, equity investments, advisory and risk mitigation services and technical assistance to private companies with the intent of alleviating poverty and promoting open and competitive markets in developing countries. IFC has 184 member countries and reported total assets of USD 77.5 billion as of fiscal year-end 2013.
Sources and Additional Resources
[1] International Finance Corporation, News, IFC Helps Azerbaijan’s TuranBank Expand Lending to Smaller Businesses
[2] TuranBank, Our Bank, Annual Reports
MicroCapital, January 8, 2015, International Finance Corporation (IFC) Purchases Entire $42m Issuance of Bonds by Rural Microfinance Institution Bancamía of Colombia
MicroCapital, December 25, 2014, Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden (FMO) Syndicates $30m Loan to Microfinance Institution FINCA Azerbaijan Including $15m From Oesterreichische Entwicklungsbank (OeEB)
MicroCapital, June 21, 2011, Microfinance Institution (MFI) TuranBank of Azerbaijan Receives Loan of $7m from IFC to Expand Rural Lending
MicroCapital Universe Profile: TuranBank
MicroCapital Universe Profile: International Finance Corporation
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