The European Bank for Reconstruction and Development (EBRD) will purchase a 20% stake in Armenia's largest bank, Ameriabank, in a $40mn deal. This is the largest single-ticket equity deal the EBRD signed in the region to date, according to the multilateral lender.
Out of the $40mn, $30mn will be used to purchase the stake and $10mn for future capital increases. The goal of the investment is reportedly to strengthen Ameriabank and to prepare it for a future initial public offering (IPO). Also, during 2016, an EBRD representative will join Ameriabank's board of directors.
Meanwhile, the International Finance Corporation (IFC) announced that it would provide a $50mn subordinated loan to Ameriabank to support its capital and boost its capacity to lend to local entreprises, according to Arka news agency.
“By providing capital support to one of our key partner banks in Armenia, we endorse its growth strategy and future plans. This cooperation is part of our efforts to increase the stability of Armenia’s banking sector, which is critical for broader economic development,” said Tomasz Telma, IFC Director for Europe and Central Asia.
Ameriabank leads the small Armenian banking sector in terms of assets, loans, deposits and liabilities. At the end of 2015, its assets stood at AMD515.8bn (€980mn), liabilities at AMD456.4bn (€860mn), capital at AMD59.3bn (€112.5mn) and profit at AMD4.8bn (€9.1mn).
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