A green and social bond to finance the private sector and green projects in Armenia

Araratbank is an Armenian bank set up in 1991 which mainly targets small and medium-sized enterprises. With a total balance sheet of USD 475.3m in 2020, it accounts for 5% of total assets in the banking sector.

Proparco has made a USD 5m subscription to a social and green bond for a total amount of USD 14.5m issued by the innovative MSME Bonds platform of Symbiotics, a Swiss asset management company specialized in impact investment. The proceeds of the bond will be transferred as a loan to Araratbank with the objective of financing MSMEs and green projects in Armenia: renewable energies (solar power plants), energy efficiency (upgrading and retrofitting of buildings and houses) and clean mobility (electric and hybrid vehicles). 

This project should contribute to the growth of some 70 MSMEs in Armenia, which will promote job creation and contribute to financial inclusion in the country. Some 60 microentrepreneurs should have access to a loan through Proparco’s financing. 

This project should also support some 1,400 jobs in the local economy, mainly through the financing for MSMEs.

Finally, the financing should have positive impacts on the climate, as part of the funds will be used to finance projects with climate co-benefits, in line with the Common Principles for Climate Mitigation Finance Tracking.

This project should thereby contribute to SDGs n° 8 (“Decent work and economic growth”) and n° 13 (“Climate action”).