News

Georgia’s TBC bank gets international support

US$161 million loan and equity investment in country’s second largest bank

As a response to the global financial crisis international financial institutions are joining forces to provide TBC bank, Georgia’s second largest bank, with a funding package of US$161 million in loans and equity investment. FMO’s contribution will be worth US$21 million and includes US$6 million equity, US$7 million subordinated loan and an US$8 million senior loan.

Other participants in the financing package are the International Finance Corporation (IFC) and EBRD, while Deutsche Investitions- und Entwicklungsgesellschaft mbH (DEG) will decide on April 30 on its participation. IFC and DEG are already shareholders in TBC, while the EBRD and FMO have been providing loans for on-lending and support. Each institution will nominate a representative on the supervisory board of the bank.

The package will help TBC reduce the impact of the global financial crisis, support its leading position in the corporate and retail banking market and increase its activities in the small and medium sized enterprises sector. Maintaining the flow of credit to the real economy is crucial in the current economic climate.

Jurgen Rigterink, FMO’s Chief Investment Officer and Member of the Management Board, stated: “In these times of financial and economic turmoil, FMO is pleased to contribute to the further recovery of trust in Georgia's financial sector. Our investment is further evidence of FMO's continued belief in the medium- and long-term economic development of Georgia and its private sector.”

Nick Tesseyman, EBRD Business Group Director Financial Institutions, said the package was “an example how international financial institutions are joining forces to strengthen a bank of systemic importance for the benefit of Georgia’s economy. We are encouraged by the swiftness and decisiveness of the response and see this as an important contribution to support the Georgian economy, which has been badly hit by the current global crisis.” 

Badri Japaridze, Deputy Chairman of the Supervisory Board of TBC, said: “As a leading bank in the country TBC Bank’s influence on the Georgian economy is critical. We see the financial package provided to us by our international partners as a confirmation of their strong commitment to our bank and Georgia’s financial sector in general. We highly value the relationship we have developed with these multilateral institutions over the years and regard their investment as a boost which will allow TBC to continue and deepen its activities for the benefit of Georgia’s real economy.”

About FMO

The Netherlands Development Finance Company (FMO) is the international development bank of the Netherlands. FMO invests risk capital in companies and financial institutions in developing countries. With an investment portfolio of €4.2 billion, FMO is one of the largest bilateral private sector development banks worldwide. Thanks in part to its relationship with the Dutch government, FMO is able to take risks which commercial financiers are not - or not yet - prepared to take. FMO's mission: to create flourishing enterprises, which can serve as engines of sustainable growth in their countries.

Press contact:

Nicoline van Slingelandt

Communications Officer (PR)

T: +31 70 314 9790

M: +31 622 563 047

E: n.van.slingelandt@fmo.nl