The European Bank for Reconstruction and Development (EBRD) has announced a loan of up to €6.9 million in local currency to Bank Respublika, one of the prominent commercial banks in Azerbaijan.
The loan is intended to be on-lent by Bank Respublika to small and medium-sized enterprises (SMEs), to enhance their competitiveness and facilitate a green transition within the local economy.
A significant portion of the funds—approximately half—is earmarked for green investments. This initiative aims to assist businesses in adopting energy-efficient technologies, utilizing renewable energy sources, and reducing their environmental impact.
By supporting such investments, the EBRD hopes to foster a more sustainable business environment in Azerbaijan.
Also read: EBRD Major Investments in Khan Bank’s Green Bond Initiative
The loan transaction is further secured by a first-loss guarantee under the European Fund for Sustainable Development Plus (EFSD+) program, which the European Union supports.
The EFSD+ financial inclusion initiative empowers micro, small, and medium-sized enterprises (MSMEs) while enhancing their competitiveness and growth potential.
Through robust financial mechanisms, the program encourages financial intermediaries to direct new lending toward the firms that require it the most.
Bank Respublika, a longstanding partner of the EBRD, has established itself as a key player in Azerbaijan’s banking sector, particularly focusing on the SME segment and promoting financial inclusion.
Also read: EBRD Extends €25 Million Loan to Enhance Energy Efficiency and Renewable Energy in Türkiye
The bank’s efforts aim to nurture the growth of local businesses, thereby contributing to the country’s broader economic landscape.
The EBRD has emerged as a leading institutional investor in Azerbaijan, having invested over €3.6 billion across 190 projects spanning various sectors of the economy.
The Bank’s strategic objectives include supporting Azerbaijan’s economic diversification and fostering the development of its private sector.
Through initiatives like the current loan to Bank Respublika, the EBRD continues to play a vital role in driving sustainable economic growth in Azerbaijan.