This financing agreement is part of a financing package initiated by IFC of up to $530 million, to be channeled through five of the country's leading private banks. The funding aims to support the participating banks by providing liquidity to help them continue lending in the quake-affected provinces.
The funds include $310 million from IFC ; €105 million from Société de Promotion et de Participation pour la Coopération Economique, SA (Proparco); €50 million from the European Fund for Southeast Europe S.A., (EFSE); $20 million from BlueOrchard Mircofinance Fund (BlueOrchard); €20 million from Green For Growth Fund, Southeast Europe S.A. (GGF); and, $7 million from Micro, Small & Medium Enterprises Bonds S.A. (Symbiotics).
The February 2023 earthquakes in southern Turkey killed more than 50,000 people, displaced more than 3.3 million, and damaged or destroyed over 800,000 buildings. It was the largest such disaster to hit the country in over 80 years. The impacted region is home to more than 470,000 private enterprises, of which 99 percent are micro, small, and medium enterprises (MSMEs). Enabling local banks to continue lending to these businesses is crucial to ensure they can fund repairs and access working capital to help them rebound.
Emmanuelle Riedel-Drouin, Global Head of Lending Operations, and Stéphane Froissardey, Regional Director at Proparco stated: “Proparco is strongly committed, alongside IFC, to participate to this program aiming at supporting the Turkish banking sector following the earthquakes that took place last February. The mobilized financial resources will be used for assistance and reconstruction efforts. Alongside efforts to rebuild public infrastructure and housing in the affected areas, providing liquidity to the financial sector is an important way to support the Turkish economy and Proparco is proud to bring its contribution to this program.”