EBRD announces new Mongolia strategy with US$50 million loan to Khan Bank

19th June 2017 Steve Hoare

The European Bank for Reconstruction and Development (EBRD) is providing US$50 million of loan finance to Mongolia’s Khan Bank as it announces a new four-year strategy for the country.

The Khan Bank sum comprises two loans for boosting micro, small and medium-sized businesses and a US$5 million loan for promoting sustainable energy projects.

The private Mongolian Bank has worked with the EBRD for some time and received an award from the bank in 2016 as one of its most active issuing banks.

The loans fall in line with two of the three points of the Bank’s new strategy, which are boosting the economy through advice and financing to MSMEs; improving infrastructure through green solutions; and reforming and investing in making the mining sector more sustainable.

EBRD Head of Mongolia Irina Kravchenko commented: “The strategy was closely coordinated with the government and it will allow us to make a meaningful contribution towards building a more resilient, diversified and competitive economy through progress in reform, diversification and sustainability.”

Since the start of its operations in Mongolia in 2006, the EBRD has invested over €1.4 billion in more than 80 projects in various sectors of the country’s economy.

Khan Bank will receive a sustainable energy loan of up to US$5 million under the Mongolian Sustainable Energy Financing Facility. It will also receive two loans under the Financial Intermediary Framework for US$30 million and US$15 million for financing private MSME clients.

The Khan Bank investments follow a US$16 million loan to local cashmere garments maker Gobi JSC. Gobi JSC is the largest cashmere and camel wool processor and garments manufacturer in Mongolia. The cashmere industry is the second largest in Mongolia after mining.

 

 

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