46674 - Cdel DAVR SDL

Who We Are
Who We Are

IFC is the largest global development institution focused on the private sector in developing countries. By encouraging growth, IFC advances economic development, creates jobs and improves the lives of people.
More About Us
About IFC

Our Leadership

Development Partners
Accountability

Learn more about accountability
Annual Report

Download the Report
What We Do
What We Do

IFC advances economic development and improves the lives of people by encouraging the growth of the private sector in developing countries. We achieve this by investing in impactful projects, mobilizing other investors, and sharing expertise.
What We Do Overview
SOLUTIONS

Our products and services
OUR PRIORITIES

Climate Business

Fragile & Conflict Afflicted Situations

Gender

Mobilizing Private Capital

Sustainability
SECTORS & EXPERTISE

Agribusiness & Forestry

Creative Industries

Education

Financial Institutions

Funds

Health

Infrastructure

Manufacturing

Public-Private Partnerships

Tourism, Retail & Property

Trade & Supply Chain Finance

Venture Capital

Working Upstream
Where We Work
Where We Work

As the largest global development institution focused on the private sector, IFC operates in more than 100 countries around the globe. We apply lessons learned in one region to solve problems in another.
Overview
By Region

Africa

East Asia and Pacific

Europe

Latin America and the Caribbean

Middle East and Central Asia

South Asia
Our Impact
Our Impact

Our impact improves lives. IFC brings a clear set of advantages to the world’s most challenging markets. Including a history of innovation, a global mandate, and a determination to achieve measurable development impact.
Our Impact Overview
PRINCIPLES & MEASUREMENT

Impact Investing at IFC

Measuring and Monitoring (AIMM)

Evaluation

Sustainable Development Goals (SDGs)

Owned by 186 member countries and consistently rated AAA/Aaa. IFC aims to achieve our mission of promoting development by providing debt and equity to the private sector, through a range of benchmark and bespoke products.

For Partners

For Investors

Get in Touch

Summary of Investment Information

Project Number

46674

Company Name

PRIVATE JOINT-STOCK COMMERCIAL BANK DAVR-BANK

Date SPI Disclosed

Feb 3, 2023

Country

Uzbekistan

Region

Central Asia and Turkiye

Projected Board Date

Mar 6, 2023

Environmental Category

FI-2 - Limited

Status

Active

Last Updated Date

Aug 12, 2023

Department

Regional Industry FIG MCT

Industry

Financial Markets

Previous Events

Approved : Feb 21, 2023
Signed : Jul 14, 2023
Invested : Aug 10, 2023

Sector

Commercial Banking - SME Finance

Additional Project Attributes

Blended Finance

Project Description

The proposed investment to existing IFC’s portfolio client, Private Joint Stock Commercial Bank DAVR-Bank (“DAVR” or the “Bank”) is a senior loan package of up to US$20 million equivalent comprising of: (i) a senior unsecured 3-year loan (incl. 1-year grace period) for the amount of up to US$10 million on IFC’s own account (A Loan) or UZS equivalent, (ii) a senior unsecured 3-year loan (incl. 1-year grace period) for up to US$10 million or UZS equivalent, to be mobilized from institutional investors (B Loan), and (iii) a cross-currency swap for the notional amount disbursed in USD (the “Project”). The purpose of the project is to support the Bank to expand its presence in the micro, small and medium enterprises (“MSME”) segment, including a carve out for gender financing of up to 40% of the loan proceeds to be on-lend to women-owned enterprises (“WOEs”).

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	10.0
Equity

IFC's loan to the financial institution described in this SII is targeted for on-lending to the following sector(s):

Product Type	Use of Proceeds
Syndications	Loans to SME Borrowers
Syndications	Loans to Woman-Owned SMEs
Straight Senior Loan	Loans to SME Borrowers
Straight Senior Loan	Loans to Woman-Owned SMEs

IFC's Definitions of Targeted Sectors can be found here.

Development Impact

Stakeholder Effects: Improved access to and quality of finance for MSMEs, including WOEs. The MSME finance gap in Uzbekistan, estimated before the COVID-19 outbreak, exceeded US$11.8 billion or approximately 18% of the country’s GDP. Given the extent of the pandemic’s impact, this gap is expected to have increased even further, making it critical to support the MSME segment. In addition, the Project may be supported with a Blended Finance component in the form of a Performance- Based Incentive to incentivize the Bank in achieving pre-agreed on lending targets to WOBs. Resilience: IFC anticipates that the project will support resilience amongst microfinance and BOP finance providers by helping the market deal with the growing uncertainty and catalyzing investor response. Disrupted borrower cash-flows and increased risk perception for the segments has left banks reluctant to lend directly to MSMEs. Macroeconomic instability and uncertainty on the long-term viability of their operations has led to increased difficulties in accessing the funds needed to support the recovery and growth of their lending operations. By investing in DAVR, IFC will demonstrate to other investors the viability of supporting the sustainability and recovery of BOP FSPs.

E&S Category Rationale / Risks and Mitigation

The proposed project is with IFC existing client DAVR Bank in Uzbekistan to support the Bank's expansion in MSME segment. The E&S risks of the activities supported under this Project are considered to be low to medium. The project has therefore been categorized as FI-2 according to the IFC's Sustainability Policy. IFC's applicable requirements for the project will be the IFC Exclusion List and the applicable environmental and social national laws and regulations of Uzbekistan. The Project will not support any activities on IFC Exclusion List, coal, and higher risk business activities involving a) involuntary resettlement, b) risk of adverse impacts on Indigenous Peoples, c) significant risks to or impacts on the environment, community health and safety, biodiversity, cultural heritage, or d) significant Occupational Health and Safety risks. DAVR Bank will also be required to maintain alignment with IFC's life & fire safety requirements and the requirements of IFC's Performance Standard 2 on Labor and Working Conditions, including those related to the contextual risks associated with Uzbekistan. The Project's key E&S risks and impacts are associated with the Bank's (i) lending activities to the MSME portfolio; (ii) its capacity to assess and manage such risks through implementation of an Environmental and Social Management System (ESMS); and (iii) contextual risks associated with Uzbekistan, i.e., use of forced labor in relation to the Bank's staff and in the supply chain of the Bank's clients operating in cotton sector.

DAVR Bank had developed an ESMS in 2017 as per the requirements of other investors. The ESMS had been revised as per the requirements of IFC's existing investment with the Bank, and is in line with the requirements of this Project as well. The procedure is implemented to the entire MSME portfolio of the Bank, references IFC Exclusion List, local E&S legislation, WBG standards and Equator Principles, and incorporates supply chain risk management mechanism for its textile loans to ensure the cotton sector related labor risks are effectively assessed and mitigated. The Bank has ESMS staff assigned, E&S training developed and regularly carried out.

Contacts

For Inquiries About the Project, Contact

Private Joint Stock Commercial Bank "DAVR-BANK“
Mr. Mirsodik Mirzakhidov
Director of Coordination and Monitoring Investment Activity Department
+998712070909 + 124
Mirsodiq.mirzahidov@davrbank.uz
100057, Uzbekistan, Tashkent, Almazar district, st. Shimoly Olmazor, house 17B
https://davrbank.uz/

For Inquiries and Comments About IFC, Contact

General IFC Inquiries
IFC Communications
2121 Pennsylvania Avenue, NW
Washington DC 20433
Telephone: 202-473-3800
Fax: 202-974-4384

IFC supports its clients in addressing environmental and social issues arising from their business activities by requiring its real sector clients to set up and administer appropriate grievance mechanisms and/or procedures to address complaints from Affected Communities in relation to environmental and social issues arising from IFC's clients' business activities. Since 2012, IFC's Financial Intermediary clients applying the Performance Standards are required to develop External Communications Mechanisms to receive and review inquiries or complaints from any interested party regarding the E&S risks and impacts of their operations.

For IFC projects that are active or under consideration, individual(s), or their authorized representative(s), who allege they have been or will be adversely affected by E&S risks or impacts arising from IFC's clients' business activities, may submit a complaint to IFC directly for consideration. When receiving an E&S complaint, IFC engages with complainants and works with its clients to find solutions to E&S concerns as quickly and efficiently as possible.

Complaints can be submitted to IFC online at www.ifc.org/escomplaints or by email to EScomplaints@ifc.org.

IFC complaint response is separate from and complementary to IFC’s clients’ project level grievance mechanisms and IFC’s Independent Accountability Mechanism (CAO). Lodging a complaint directly with IFC does not, at any time, restrict access to CAO.

Affected communities have unrestricted access to the Compliance Advisor Ombudsman (CAO), the independent accountability mechanism for IFC and MIGA. CAO facilitates the resolution of complaints related to IFC and MIGA projects and sub-projects, undertakes reviews of IFC’s and MIGA’s environmental and social compliance, fosters public accountability for their commitments, and enhances the environmental and social performance of IFC and MIGA.

Independent of IFC and MIGA management and reporting directly to the IFC and MIGA Boards of Executive Directors, CAO helps resolve issues raised about the environmental and social impacts of projects through a neutral, collaborative, problem-solving approach via its Dispute Resolution function. It also reviews IFC’s and MIGA’s compliance with environmental and social policies, assesses related harm, and recommends remedial actions through its Compliance function. Additionally, CAO provides advice to IFC, MIGA, and their Boards to enhance environmental and social sustainability performance and minimize the risk of harm.

Complaints may relate to environmental and social harm regarding any aspect of the planning, implementation, or impact of a project or sub-project, and can be made by any individual, group, community, entity, or other party affected or likely to be affected by the environmental or social impacts of an IFC- or MIGA-financed business activity.

Complaints can be submitted by any of the following methods:

Online form: available at https://www.cao-ombudsman.org/
Mail/Hand Delivery to: 2121 Pennsylvania Avenue, NW, Washington, DC 20433, USA
Voice mail: +1 202 458 1973
Email: cao@worldbankgroup.org
SMS, WhatsApp, Telegram, and Signal: +1 202 650 2627

CAO receives and addresses complaints in accordance with the CAO Policy, which can be accessed at: https://www.cao-ombudsman.org/policies-guidelines.

This Summary of Investment Information (SII) is prepared by IFC to disclose a factual summary of the main elements of the potential investment. It also includes findings and recommendations related to environmental and social considerations regarding this potential investment. The purpose of the SII is to enhance the transparency of IFC’s activities. For any project documentation or data included or attached herein, whether prepared by the project sponsor or otherwise, authorization has been given for public release by the project sponsor. IFC considers that this SII is of adequate quality for release to the public, but has not necessarily independently verified all of the project information therein. It is distributed in advance of IFC Board of Directors’ consideration and may be periodically updated thereafter. Board dates are estimates only and this document should not be construed as presuming the outcome of the Board Directors’ decision. The following SII is disclosed in accordance with IFC's Access to Information Policy (AIP) that went into effect on January 1, 2012.

The map is for illustrative purposes and does not imply the expression of any opinion on the part of the World Bank, concerning the legal status of any country or territory or concerning the delimitation of frontiers or boundaries. Country borders or names do not necessarily reflect the World Bank Group's official position. In some cases, available project location information is limited to the country of the project's activities. Locations are approximate.

Projects

Summary of Investment Information

Project Description

Sponsor / Cost / Location

Development Impact

E&S Category Rationale / Risks and Mitigation

Similar Projects

Contacts

Projects

Summary of Investment Information

Project Description

Sponsor / Cost / Location

Project Sponsor and Major Shareholders of Project Company

Total Project Cost and Amount and Nature of IFC's Investment

Blended Finance

IFC's Investment as Approved by the Board

FIG Use of Proceeds/Beneficiaries

Location of Project and Description of Site

Development Impact

Anticipated Impact Measurement & Monitoring (AIMM) Assessment

IFC's Role and Additionality

E&S Category Rationale / Risks and Mitigation

Environmental & Social Categorization Rationale / Key Risks & Potential Impacts

Environmental & Social Management System (ESMS)

Mitigation Measures / Environmental & Social Action Plan (ESAP)

Press-Release

Related Environmental Document

Similar Projects

Contacts

Information on E&S Complaints and Grievance Mechanisms

Disclaimer