YEREVAN (The FINANCIAL) — The European Bank for Reconstruction and Development (EBRD) is extending a line of credit to a major Armenian Bank for industrial entities to finance projects aimed at improving the efficiency of their energy use and/or increasing energy production from renewable sources.
In line with its first two-year sustainable energy finance scheme in Armenia, the EBRD is providing a $3 million senior loan (approximately 1 billion Armenian drams) to Anelik Bank, one of the leading lenders to the private sector in Armenia.
“With the help of this loan, Armenian businesses can reduce their energy costs and thus become more competitive on the domestic and international markets”, the Head of EBRD’s Office in Armenia, Valeriu Razlog said after the loan signing.
“In our 20 years of operations, Anelik Bank has always promoted similar initiatives, which enable us to support enterprises and entrepreneurs to become more competitive. What is special about this programme is that it will allow the introduction of systems and processes which reduce energy consumption, including the modernisation of production lines and small hydro power plants. Being the first Armenian Bank to join this EBRD-led programme, we are confident it will bring effective results and we are ready to finance all the applicants who meet the programme’s requirements,” said the Chairman of the Board of Anelik Bank, Samvel Chzmachian.
According to EBRD, the loan will allow Armenian clients to make energy savings up to an estimated 4GWh per year and reduce CO2 emissions by 2,200 tons per year by restructuring their facilities and utilizing investments resulting in rational energy use within both electricity and heating systems.
The EBRD says the loan, disbursed through its Caucasus Energy Efficiency Programme (CEEP), will enable Anelik Bank to meet increasing demand for energy efficiency loans and to maintain the availability of these specific credits to private companies and entities in a challenging environment where access to alternative sources of finance remains limited.
The line is complemented by technical assistance – provided by the Federal Ministry of Finance of Austria – comprising of consultants who will prepare energy audits, review investment proposals and support companies in securing funding from Anelik Bank.
Earlier this month EBRD extended $6 million to Anelik Bank for on-lending to small and medium size enterprises and to further support the development of the country’s private sector.
Anelik Bank ranks the 7th in the banking system of Armenia by total capital. The bank provides a wide range of banking services in Armenia with a special focus on lending to small and medium enterprises.
Since the beginning of its operations in Armenia in 1992, the EBRD has invested over 420 million euro in 82 projects in the country’s financial, corporate and energy sectors, and infrastructure, with 96 percent of the projects’ being investments into the development of the private sector.