XacBank receives USD 5 million in loans from IFC
Ulaanbaatar, Mongolia, June, 14 2007 -
XacBank is pleased to announce that the International Financial Corporation (IFC), the World Bank’s private sector investment arm, on 11 June 2007 has signed an agreement with the bank to provide a 7-year USD 5 million new loan to support its growth in microfinance. The loan agreement was signed by Ganhuyag Ch. Hutagt, CEO of XacBank, and by Nina B. Shapiro, Vice President, Finance and Treasurer, International Finance Corporation (World Bank).
The loan will have a strong developmental impact as it will assist XacBank to expand operations in support of productive micro and small businesses, herders and small agricultural enterprises in rural areas across Mongolia. IFC will also play an important role by providing ongoing advice on the business plan and strategy implementation of the bank.
XacBank was the first commercial bank in Mongolian to receive a loan from IFC. In June 2002, IFC provided the bank with an 8-year loan amounting to USD 400,000 with 2-year grace period. From January 15, 2005, the bank began to make repayment and has kept a good repayment record, leading to this second loan agreement with increased size.
At the conclusion of the signing ceremony, Mrs. Shapiro noted that, “IFC has supported other financial institutions in Mongolia, but I think that XacBank is a natural partner for IFC. I think the wonderful emphasis and success that XacBank has had with microfinance, small and medium enterprises, and now with mortgages is a natural development objective for IFC as well. And we are very impressed with how efficient the bank is and how well they have promoted their business. And it is something we feel very proud to support.”
XacBank is the leader among Mongolian microfinance lenders with an average loan size of about MNT 1,105,868 ($953 equivalent), delivering innovative financial products and services to all the regions of the country through a network of 67 branches. IFC’s loan will support and help to sustain the strong growth it has demonstrated in recent years.
The IFC is a multilateral institution that furthers the economic development of its 178 member countries, including Mongolia, through the promotion of private investment. IFC finances private sector investments in the developing world, mobilizes capital in the international financial markets, and provides technical assistance and advice to governments and businesses. In addition to deploying its own resources, the Corporation has sought to catalyze additional investment flows to private companies in developing countries.