A program launched by the European Bank for Reconstruction and Development and the Albanian government last year to provide farmers and agribusinesses in the Balkan country greater access to financing has reached €180 million in loan commitments.
An EBRD spokesman confirmed Raiffeisen will be the next institution to join the Albania Agribusiness Support Facility, committing €30 million. Intesa Sanpaolo Bank Albania also recently agreed to lend up to €50 million during the course of the three-year program, with the EBRD providing unfunded risk participation of €25 million.
The other backers are NOA and Fondi Besa, which have received credit lines of €5 million each, while Procredit has signed up for €30 million and French bank Société Générale for €60 million, the spokesman told Agri Investor.
The scheme is backed by €100 million in funding and risk-sharing facilities provided by EBRD, while the government of Albania has committed to making available up to €36 million over the course of the three-year program, which will go toward first-loss risk cover.
The EBRD says agribusiness provides employment for close to 50 percent of Albania’s labor force and represents 20 percent of the country’s GDP. However, loans to the agricultural sector account for only 2 percent of total lending to the economy.
“We commit our resources to develop, launch and implement the facility, working with the EBRD and its appointed experts in being able to deliver even better customized products and services for this specific sector where we have focused for the past three years,” said Silvio Pedrazzi, chief executive of Intesa Sanpaolo Bank Albania.
The bank will provide financing to companies engaged in a number of agribusiness activities, including primary agriculture, agri-equipment, logistics, service providers and agri-processing, Pedrazzi said.
As participants in the AASF program, financial institutions will receive technical assistance in developing new financing products for the agri sector, improving internal procedures for agribusiness lending, scoring models, training of dedicated staff and other activities, EBRD’s spokesman said.
The development bank has invested more than $1 billion in the country since 2011. According to the statement, it is active in all sectors of the economy but places particular emphasis on infrastructure, energy and SME development.