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MDM Bank signs an eight-year $100 million senior loan agreement with IFC

16.05.2007 20:19

MDM Bank today signed an agreement to obtain an eight-year $100 million senior loan from IFC, the private sector arm of the World Bank Group. The financing will be used by the Bank to support the growth of its mortgage and small and medium enterprise lending portfolio to reach regions outside Moscow that are still underserved and underdeveloped. In addition, IFC will provide advisory services to the Bank to help it improve its mortgage operations and establish an environmental management system that will help make its operations more sustainable. Michel Perhirin, Chairman of the Board of MDM Bank, said, IFCs cooperation with the bank is an important milestone for us. It will help us improve our lending program to small and medium enterprises and expand our mortgage portfolio. This is a recognition of our achievements in developing our core businesses and in strengthening our corporate governance practices.

In 2006, MDM Banks portfolio grew by over 350 percent in SME lending and 340 percent in mortgages. With a current portfolio of about $215 million for SMEs and about $170 million for mortgages, the bank offers SME loans and mortgages through its entire network in 34 regions in Russia. Thanks to this new IFC loan, we intend to build on our achievements in 2006, continuing to extend credit to small enterprises, as well as providing mortgages through our wide branch network, Perhirin added.

Jerome Sooklal, IFC Director for Central and Eastern Europe, said, We are very pleased to start our partnership with MDM Bank. Partnerships of this kind enable IFC to make a number of strategic developmental contributions to the Russian banking sector. We also believe that our long-term financing and advisory support will help MDM Bank to improve its mortgage and SME lending, which is crucial for sustainable growth of the middle class in Russias regions.

Jyrki Koskelo, IFC Director for Global Financial Markets, said, "We believe that our advisory support will strengthen the banks market position in mortgage and SME lending, making it a role model for the Russian banking industry."

23.07.2007 20:37

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