IFC is providing its long-term partner Hamkorbank, a midsize private bank in Uzbekistan, with debt and equity finance to support the bank’s growth and expand access to finance for small and medium enterprises, the IFC statement said.

IFC will invest US$3 million in Hamkorbank’s equity and provide the bank with a five-year US$2 million loan for lending to micro, small, and medium enterprises. As an equity investor, IFC will help the bank improve its corporate governance practices and strengthen its risk management and operating practices. The debt financing will expand access to finance for micro, small, and midsize companies in rural areas of Uzbekistan, particularly in the Ferghana Valley and Karakalpakistan.

"We are pleased to expand our cooperation with Hamkorbank and become its shareholder. This marks a new stage of our joint efforts to ease access to finance for local small businesses in the regions of Uzbekistan and thereby open new employment opportunities for people in villages across the country," said Rashad Kaldany, IFC Vice President for Asia, Eastern Europe, the Middle East and North Africa.

Ikram Ibragimov, Chairman of the Council of Hamkorbank, said, "We welcome IFC, our long-term partner, as a new shareholder. This is a sign of the bank’s solid strategy and its commitment to further growth."

Hamkorbank has been receiving advisory support from IFC since 2001, helping the bank develop prudent credit and risk-management practices. To date, IFC has provided $4 million in loans to Hamkorbank.

IFC, a member of the World Bank Group, creates opportunity for people to escape poverty and improve their lives. We foster sustainable economic growth in developing countries by supporting private sector development, mobilizing capital for private enterprise, and providing advisory and risk mitigation services to businesses and governments. Our new investments totaled US$14.5 billion in fiscal 2009, helping channel capital into developing countries during the financial crisis.

Hamkorbank open joint-stock commercial bank was founded in 1991 and currently it possesses 26 branches and 125 mini-banks across Uzbekistan. The bank started its work in Andijan city and now operated in all regions of Uzbekistan, rendering banking services to corporate clients and population.

Assets of the bank made up over 310.3 billion soums as of 1 April 2010, own capital comprises 42 billion soums. The charter capital of Hamkorbank is 17.8 billion soums (about US$11.366 million).