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PRESS RELEASE

Turkey’s Small And Medium Enterprises To Benefit From New World Bank Financing

June 15, 2010



Washington, D.C., June 15, 2010—The World Bank Board of Executive Directors today approved a US$500 million loan for the Second Access to Finance for Small and Medium Enterprises (SMEs) project for Turkey. The project’s main development objective is to broaden and deepen the access of Turkish small and medium enterprises to medium- and long-term finance, with a view to ultimately help expand productive activities and job creation.
 
The Second Access to Finance for Small and Medium Enterprises project will be implemented by Turkish Kalkınma Bank (US$100 million), Ziraat Bank (US$200 million), and Vakıf Bank (US$200 million) as borrowers, with a government guarantee, and will provide medium- and long-term working capital and investment finance to small and medium enterprises in Turkey.
 
“Small and medium enterprises are the engine of the Turkish economy,” said Ulrich Zachau, Country Director for Turkey on the occasion of the loan approval. “Continued access to finance for SMEs is crucial for growth and jobs, especially in the aftermath of the global economic crisis. The loan provides such crucial financing for SMEs, who face access to finance as the biggest obstacle to their growth. In addition to providing SME financing, the project is also designed to help develop the market for commercial credit to SMEs over the long term – as domestic banks are ultimately expected to expand their lending business to SMEs.”

The World Bank credit line will complement existing credit facilities provided by the World Bank, and seeks to build on the success of the current Access to Finance for SMEs Project (SME I) – a financial intermediation loan currently being successfully implemented by Halkbank and Türkiye Sinai Kalkınma Bankasi (TSKB). The project was approved by the Bank in June 2007 (US$250 million equivalent), with two Additional Financings provided to Halkbank in December 2008 (US$200 million equivalent) and December 2009 (US$250 million equivalent), bringing the total loan amount to US$700 million equivalent.
 
The lending instrument for the Second Access to Finance of SMEs Project is an IBRD Flexible Loan at 6 months LIBOR for US Dollars plus variable spread with a 25 year maturity, including 10 year grace period, commitment linked and with level repayment pattern for Türkiye Kalkınma and Ziraat Banks; and an IBRD Flexible Loan at 6 months LIBOR for US Dollars plus variable spread with a 29.5 year maturity, including 6 year grace period, commitment linked and with level repayment patter for Vakıfbank. The Loan is guaranteed by the Turkish Treasury.

Media Contacts
In Ankara
Tunya Celasin
Tel : (90-312) 459 8343
tcelasin@worldbank.org
In Washington
Kristyn Schrader
Tel : (202) 458-2736
kschrader@worldbank.org

PRESS RELEASE NO:
2010/476/ECA

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