Status: Approved investment
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FMO is committed to making publicly available relevant investment information that informs stakeholders and enables them to engage directly with FMO on its investments which, in turn, enhances our investment decisions, the design and implementation of projects and policies, and strengthens development outcomes. Learn more

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The information as disclosed is indicative and provided on an "as-is/as available" basis for general informational purposes only and should not be construed as financial, legal or investment advice, nor as a commitment or an offer to arrange or provide any financing. The final decision to provide financing is subject to the terms and conditions of FMO in its sole and absolute discretion. When providing links to other sites, FMO bears no responsibility for the accuracy, legality or content of the external site or for that of subsequent links. The information on proposed investment for high-risk investments is made available in the language relevant to the country or region where the bulk of operations take place. Translations of any information into languages other than English are intended as a convenience for local stakeholders. In case of any discrepancy, the information provided in English will prevail.

Who is our customer

Armeconombank (“AEB”) in the Republic of Armenia is a top-10 Armenian mid-sized universal bank with a focus on MSME/Retail. AEB reports Total Assets ~USD 573m, Equity USD 85m and RoA 1%. FMO has partnered with AEB previously, between 2010 and Dec-2013 and is an existing client again since early 2019.

What is our funding objective?

The loan agreement consist of a EUR 5 million and a USD 10 million tranche. The attracted funding will be used for Green and Reducing Inequalities projects: - 1/3rd will be used to finance "green" projects of the bank which are in compliance with FMO's Green Master List. - 2/3rd will be used to finance eligible Micro, Youth, Women and Agriculture customers of the bank in line with FMO's eligibility criteria, supporting our impact goal of reducing inequalities.

Why do we fund this investment?

Green and Reducing Inequalities is at the heart of FMO’s strategy. FMO's loan will be used for 2/3rd (approx. USD 10.3 million) by AEB to finance their Micro, Small and Medium Enterprises (MSME) portfolio. MSME are the core of the Armenian economy. The private sector in Armenia is dominated by MSME’s, making up about 98% of total registered enterprises. However, they contribute only for ~25% of GDP and ~33% of employment (source: EIB). Access to credit remains critical for further development of the MSME segment. More specifically, the loan proceeds will be used to finance a combination of Micro clients and eligible women/youth/agriculture clients of AEB (contributing to SDGs 5, 8 and 10). In turn, this supports job creation and maintenance in a Low to Middle Income Country (LMIC) where 12% of the population live below the poverty line (Worldbank, $3.2/day poverty line) and unemployment rate is ~18% (39% for youth). FMO's loan will be used for 1/3rd (approx. USD 5.2 million) by AEB to finance eligible green projects supporting FMO's Climate Action target.

What is the Environmental and Social categorization rationale?

The project has been categorised as Category C in accordance with FMO’s Sustainability Policy. The Project’s activities are deemed to have minimal or no adverse environmental and social risks and/or impacts. As part of the Project, the bank will be required to apply the EDFI Exclusion List and (Country) E&S laws and regulations.

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Date Total FMO financing
5/5/2020 EUR 5.00 MLN
6/8/2021 USD 5.00 MLN
5/15/2019 USD 10.00 MLN
2/5/2024 USD 30.00 MLN
Website customer/investment
Europe & Central Asia
Financial Institutions
Effective date
Total FMO financing
USD 10.00 MLN
Risk categorization on environmental and social impacts, A = high risk, B+ = medium high risk, B = medium risk, C = low risk Environmental & Social Category
(A, B+, B or C)