Raiffeisenbank Leasing S.R.L.

MIGA has issued a $23.8 million guarantee to Raiffeisen Zentralbank Österreich AG of Austria to cover its shareholder loan to Raiffeisen Leasing S.R.L. in Romania. The loan aims to expand the subsidiary’s leasing operations in Romania, particularly to small and medium-size enterprises. The coverage is for up to four years, and protects against the risks of transfer restriction and expropriation of funds.

Leasing has become one of the most popular instruments in Romania for financing a variety of assets required by both individuals and Romanian enterprises. Raiffeisen Leasing S.R.L., established in Romania in 2002, provides leasing services primarily in the areas of equipment, vehicles and, since 2005, real estate. In 2004, Raiffeisen Leasing concluded €117 million in contracts, double its 2003 results. The company holds a 10 percent market share.

The financing and guarantees will enable Raiffeisen Leasing to increase its portfolio and the availability of financing alternatives, and thus be able to provide enhanced leasing services to all of its clients, especially manufacturers, exporters, and SMEs. The increased resources will allow SMEs greater access to financing for new manufacturing equipment, allowing them to replace outdated capital assets. The availability of high-quality, efficient, and competitively priced leasing services to the corporate sector, as well as to retail customers, will bolster the performance of Romania’s financial sector and increase its efficiency. This in turn is expected to have a positive impact on Romania’s private sector and its economy overall.

Raiffeisen Leasing has a network of 16 units located in Romania’s main cities, which provide proximity to customers, flexibility in terms of contract and reimbursement, greater specialization for its team of professionals, and close links and cooperation with suppliers. Through this network the company is able to harness local market knowledge to the benefit of its customers. The loan will help expand its local presence throughout the country and improve synergies with local entities.

Raiffeisen Leasing counted 88 employees in Romania by the end of 2004, which is expected to double in the next four years. Raiffeisen Leasing employees benefit from the transfer of know-how and experience regarding sophisticated leasing products and new developments, such as vendor-leasing concepts, real estate development and leasing, facility leasing for public entities, as well as up-to-date leasing information technology that considerably reduces processing time.

MIGA’s involvement in this project is consistent with Romania’s country assistance strategy, which includes the promotion of growth through private sector development and the creation of an efficient, healthy, and competitive financial sector.