(Sharecast News) – Bank of Georgia Group announced two fresh financing agreements on Thursday, aimed at supporting sustainable initiatives and promoting economic growth in Georgia.
In the first announcement, its subsidiary JSC Bank of Georgia inked a multicurrency loan agreement with the European Investment Bank (EIB), totaling €50m with a maturity period of up to seven years.
The primary objective of the agreement was to provide financial support for investment projects initiated by small and medium-sized enterprises (SMEs) and mid-cap enterprises operating within Georgia.
Under the agreement, Bank of Georgia said it would allocate a minimum of 30% of the loan towards environmentally sustainable projects, marking the first thematic loan agreement between BOG and EIB in that regard.
The facility would be further bolstered by support from the ‘Greening the Financial Systems’ technical assistance programme, financed by the German government’s international
climate initiative.
“We greatly appreciate EIB’s ongoing support for Bank of Georgia and Georgian businesses,” said chief executive officer Archil Gachechiladze.
“This transaction, with a specific focus on green investments, is another important step towards the sustainable development of the local economy.
“Georgia has recently gained EU candidate status – a key milestone that will further improve business confidence, and in this context, the ongoing support from our partner IFIs is very important.”
In the second announcement, Bank of Georgia said it had sealed two subordinated facility agreements, both structured as tier-two loans.
The first, a €25m agreement, was with the Green for Growth Fund (GGF) Southeast Europe, and the second, a €20m agreement, was with the European Fund for Southeast Europe.
It said the agreements came with a lengthy 10-year maturity period.
Once disbursed and subject to approval from the National Bank of Georgia, the proceeds would be incorporated into the tier-two capital of the bank.
Notably, the €25m facility from GGF carried a green component, while the €20m facility from EFSE was earmarked for sustainable economic activities and women-majority-owned or led micro, small, and medium-sized enterprises (MSMEs).
The bank had undertaken to identify and allocate predefined amounts to eligible investments in these areas, underscoring its dedication to fostering sustainable economic development.
“I would like to thank our long-term partners, GGF and EFSE, for their cooperation,” Archil Gachechiladze added.
“We appreciate their ongoing support for Bank of Georgia and local businesses in Georgia.
“These facilities enable us to continue empowering our customers, while maintaining a strong capital position.”
Reporting by Josh White for Sharecast.com.
