Hypo Alpe-Adria-Bank A.D. Beograd

MIGA issued a $15.6 (€13.2) million guarantee to Hypo Alpe-Adria-Bank AG (HAAB) of Austria for its $17.3 (€14.6) million equity investment in Hypo Alpe-Adria-Bank AD, Beograd (HAAB-SAM) in Serbia and Montenegro. The project is for a period of ten years and provides coverage against the risks of Expropriation and War and Civil Disturbance.

The equity investment will allow HAAB-SAM to provide financing to both local companies and individuals. Approximately 65 percent of its portfolio is for corporate lending, while the remaining 35 percent will be for retail banking activities. An estimated 60 percent of its corporate portfolio is expected to be lent to local SMEs. HAAB's investment will bring modern lending techniques and services, as well as asset/liability management experience to its subsidiary, thus enhancing the development of the financial sector. It is also expected to create approximately 40 jobs by the fifth year of operation. Serbia and Montenegro is a IDA-eligible country, and thus this project addresses a priority area for MIGA.