Raiffeisenbank a.d.

MIGA has issued a €47.5 million guarantee to Raiffeisenbank a.s. of the Czech Republic covering its €50 million non-shareholder loan to Raiffeisenbank a.d. of Serbia and Montenegro. The guarantee is for six years and covers against the risks of transfer restriction and expropriation.

The loan will help the bank expand its medium-term lending to Serbia’s corporate sector, which is dominated by small and medium-size enterprises (SMEs). This is the fifth such project with RZB that MIGA has guaranteed in this nation, which is still working to emerge from the political upheaval and civil war of the 1990s.

MIGA’s focus on finance projects in a country with a young and limited financial sector will help deepen and expand the market, which is currently dominated by banking. The credit sub-sector lags behind considerably—and the lack of available credit is one of the primary obstacles to local small business growth. The country’s relatively undeveloped financial infrastructure also prevents foreign investors from taking more notice of this well-located southeastern European nation. Enhancements to RBSM’s medium-term lending capacity will open to door for more businesses to secure credit with longer loan periods, enabling expansion to meet growing demand.

The MIGA guarantee complements Serbia and Montenegro’s Country Assistance Strategy, which focuses on creating a more dynamic private sector and on poverty reduction. The project also reflects MIGA’s efforts to rebuild post-conflict nations, and to support small and medium-size business growth through improved access to finance.