ATF Bank, the fifth largest commercial bank in Kazakhstan, currently owns 95.84% of ATFBank-Kyrgyzstan. The remaining 4.16% stake in ATFBank-Kyrgyzstan is owned by 32 individuals and legal entities.

ATF Bank of Kazakhstan was acquired by UniCredit Group in 2007.

The proposed project involves a loan of up to $15 million with a five-year maturity to ATFBank-Kyrgyzstan to support its SME lending operations.

15.0 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	15.0
Equity

* These investment figures are indicative

ATFBank-Kyrgyzstan is headquartered in Bishkek, Kyrgyz Republic and has 13 branches from which it conducts business throughout the Kyrgyz Republic.

The proposed investment in ATFBank-Kyrgyzstan will support the SME lending activities of the Bank in the country. Kyrgyz Republic is a frontier market for IFC, a primary focus area. Banking penetration is very low in the country, and banking activities are focused on large corporates as well as large cities. SMEs’ access to finance, especially medium and long-term finance, is very limited.

This loan will:

Enhance the Bank’s ability to access medium-term funding and on-lend funds to underserved sectors. Through increased access to finance, Kyrgyz entrepreneurs would be able to access to finance for continuing their activity. Also, SME sector is critical to support job creation where unemployment rate is increasing, and
support the efforts of one of the leading banks in Kyrgyzstan to diversify and increase the volume of its funding, and to better manage its asset and liability position at the time of limited funding opportunities in the country.

Banks and companies are experiencing difficulty even in sourcing shorter tenor funds, which is severely curtailing economic growth. Through this Project IFC would provide much needed funding that is currently not available from other commercial sources to an underserved market segment of the Kyrgyz economy. IFC would create a new relationship with the Bank and give positive reinforcement to the Bank’s focus to serve more customers and expand its outreach.

In addition, IFC, being global leader for sustainable environmental and social banking practices, will help the Bank develop in this regard as part of the loan approval and supervision process, thereby catalyzing industry improvements in the Kyrgyz Republic.

For this Category FI project, IFC is assessing ATF Bank-Kyrgyzstan’s risk management systems and capacity to perform the necessary social and environmental due diligence against the applicable performance requirements; and reviewing the Bank’s labor practices against IFC’s Performance Standard 2: Labor and Working Conditions. Applicable performance requirements will include the IFC Performance Standards, the applicable National Social and Environmental Laws and regulations and the IFC FI Exclusion List. If required, IFC will suggest supplemental actions to address any gaps in the Bank’s risk management systems and capacity.
Based on the review, the Bank will be required to:

- Develop an, or upgrade, if necessary, any existing Social & Environmental Management System (SEMS), prior to disbursement to the satisfaction of IFC.
- Identify responsible, qualified persons to manage and implement the SEMS.
- Commit to implement the SEMS, to ensure that its investments/activities are in compliance with the Applicable Performance Requirements.
- Demonstrate commitment to applying the labor standards established by the IFC Performance Standard 2: Labor and Working Conditions.
- Submit a periodic report to IFC as per a format to be provided by IFC.