EFSE provides EUR 7 million loan to Romania’s Patria Credit

Frankfurt am Main and Bucharest, 28 March 2011 – The European Fund for Southeast Europe (EFSE) is providing a new EUR 7 million loan to SC Patria Credit IFN SA (Patria Credit). Patria Credit will use the loan for on-lending to local micro and small enterprises (MSEs) in rural areas of Romania, mobilising capital for a segment of the country’s economy deeply under served by local banks. The EFSE will provide part of the financing in Romanian Leu, allowing Patria Credit to meet the growing demand for long-term local currency financing to MSEs.

Patria Credit, headquartered in Romania’s capital, Bucharest, is the largest non-bank financial institution in Romania targeting the micro, small and medium-sized business sector, in both urban and rural areas.

“We are glad to sign the loan agreement with Patria Credit. This investment is consistent with EFSE’s strategy to support well-managed institutions with a dedicated commitment to reach out to small businesses”, said Dr. Klaus Glaubitt, Chairman of the EFSE Board of Directors. “Broadening and deepening the Romanian financial sector in an area of great need, this investment will expand access of credit to more than 1,700 micro and small enterprises in rural areas of Romania. Moreover, the local currency component of this loan agreement will enable Patria Credit to mitigate the foreign currency exchange risks for its clients.”

“The funding received from the EFSE will allow our company to further implement its strategic plans of providing lending to entities with limited access to financial services, due to either geographical or financial exclusion. We value the role of the EFSE in the support provided to micro enterprises and agricultural producers to develop and fully achieve their potential. Patria Credit’s business growth over the past 12 months has proven that these market segments are very dynamic and use loans more frequently to cover their funding needs”, commented Mr. Bogdan Merfea, the Chief Executive Officer of Patria Credit.

The current loan is the second loan Patria Credit has received from the EFSE. It follows a loan dated back to 2006 of EUR 2 million. To date, the Fund has provided EUR 100 million to the financial sector in Romania for on-lending to local MSEs. Moreover, the EFSE has awarded approximately EUR 0.5 million in technical assistance to Romanian partner lending institutions to help expand their lending to MSEs.

About the European Fund for Southeast Europe (EFSE)
The European Fund for Southeast Europe (EFSE) aims to foster economic development and prosperity in the Southeast Europe and Caucasus region. For this purpose, the EFSE offers long-term financing instruments to local financial institutions, enabling the granting of business loans primarily to micro and small enterprises as well as housing and home improvement loans to private households. The investment activities of the EFSE are supported by the EFSE Development Facility, which provides technical assistance, consulting and training services to partner lending institutions. The EFSE was formed on December 15, 2005 out of four multi-donor programs managed by KfW Entwicklungsbank (The German Development Bank) as part of the first public-private partnership initiative for developmental finance. The Fund's four founding countries were Bosnia and Herzegovina, Serbia, Kosovo, and Montenegro, with Albania, Armenia, Azerbaijan, Bulgaria, FYR Macedonia, Georgia, Moldova, Romania, Belarus, and the Ukraine having joined over the past five years. While the capital invested at the time of the Fund's inception stood at EUR approximately EUR 66 million, the EFSE is now invested in 65 local financial institutions to the value of EUR 664.4 million (as of 31 December 2010). The capital is provided by public donors, international financial institutions as well as private institutional investors. The EFSE's donors and investors include the German Federal Ministry for Economic Cooperation and Development, the European Commission, the governments of Austria, Switzerland, Denmark and Albania, KfW, IFC, Netherlands Development Finance Company, European Bank for Reconstruction and Development, European Investment Bank, Oesterreichische Entwicklungsbank, Sal. Oppenheim and Deutsche Bank. The Fund is managed privately by Oppenheim Asset Management Services and Finance in Motion as fund manager and fund advisor, respectively.
For more information, please visit: http://www.efse.lu

About Patria Credit
Patria Credit (former CAPA Finance) is the largest non-bank microfinance institution providing loans to micro and small companies. As of year-end 2010, the company was serving a number of over 10,000 customers through a network of 16 branches in large cities and 21 branches located in rural areas. The company has Total Assets of EUR 40 million (as of 31 December 2010).
The main shareholders of the company are the Romanian American Enterprise Fund (RAEF) and Balkan Accession Fund (BAF).
For more information, please visit: http://www.patriacredit.ro/


Media contact EFSE
Samir Djikić
Manager Communications
Tel: +49 (0)69/977 876 50-26
E-mail: press@efse.lu

Media contact Patria Credit
Camelia Raileanu
Marketing Manager
Tel: +40 (0)21 304 00 72
E-mail: camelia_raileanu@patriacredit.ro