Sibakadembank is controlled by three of its senior managers, Messrs. Kim, Bekarev, and Taranov, who together control 80% of the bank’s capital. The bank has maintained its independence from financial and industrial groups and established good reputation throughout its 13 years of operation.

The project consists of a senior loan for IFC’s account of up to $7.0 million and an option to purchase SAB’s shares of up to $2.0 million at a later date.

7.0 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	7.0
Equity

* These investment figures are indicative

SAB is headquartered in Novosibirsk and currently has 7 branches and 29 additional offices throughout Siberia.

This is a category FI Type 1 project according to IFC’s environmental and social review procedure. The bank will be required to establish an environmental management system for its corporate and SME lending operations to ensure that the activities and enterprises it finances comply with Russian environmental and occupational health and safety requirements. Designated SAB officers will complete IFC’s environmental training course for financial intermediaries and the bank will provide IFC with environmental performance reports on an annual basis.
Location of environmental documents in locally affected community

Underdevelopment of the financial sector in Russia, especially in the regions, is one of the major weaknesses of the Russian economy. In addition to addressing this gap, the project will have a positive impact on regional economic development as: - SAB will broaden the range of financial products available to its clients. The underdeveloped SME sector has been consistently identified as a major barrier to growth in Russia, and this problem is particularly severe in Siberia. - SAB’s capacity to develop into a leading regional bank with a cross-regional presence will be strengthened. SAB remains one of the few private independent banking networks in a vast geographic area from Omsk to Irkutsk, a distance of over 2000 km. IFC’s Role: - IFC has provided SAB with significant TA support designed to assist SAB in its efforts to introduce international bank practices in the areas or risk management and organizational development. - IFC would support SAB’s continued development as IFC’s long-term financing should help the bank to expand its client base, improve structure of its balance sheet, and broaden funding sources. - IFC would extend geographic reach of its investment operations in the financial sector to Siberia, the region which is under-served in the area of financial services, and support a bank which may play an important role in consolidation in the banking sector. - Should IFC become SAB’s shareholder in the future, it could have an important impact on the bank’s corporate governance and its ability to attract other investors.