Khan Bank Syndication Loan (IFC-38121)

Regions
  • East Asia and Pacific
Where the impacts of the investment may be experienced.
Countries
  • Mongolia
Where the impacts of the investment may be experienced.
Financial Institutions
  • International Finance Corporation (IFC)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Project Status
Approved
Bank Risk Rating
FI
Risk rating varies among banks and may refer only to the particular investment and not to the risk for the project as a whole. Projects marked 'U' have an 'Unknown' risk rating at the time of disclosure.
Voting Date
May 31, 2016
The estimate day the bank will vote on a proposed investment. The decision dates may change, so review updated project documents or contact the EWS team.
Borrower
KHAN BANK LLC
The holder of the loan, grant, or other investment.
Sectors
  • Finance
The service or industry focus of the investment. A project can have several sectors.
Investment Type(s)
Loan
The categories of the bank investment: loan, grant, etc.
Investment Amount (USD)
$ 40.00 million
Value listed on project documents at time of disclosure. If necessary, converted to USD$. Please review updated project documents for more information.
Project Cost (USD)
$ 100.00 million
Value listed on project documents at time of disclosure. If necessary, converted to USD$. Please see updated project documentation for more information.
Primary Source

Original disclosure @ IFC website

Updated in EWS Jul 29, 2018

Disclosed by Bank Apr 13, 2016


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Project Description

The proposed investment is a syndicated senior loan of up to US$100 million to Khan Bank LLC, an IFC's existing client, to strengthen the Bank's capacity in supporting local micro and SMEs in Mongolia.

Expected Development Impacts
i. Access to finance: Given the Bank's strategic plan and its focus on small and medium sized enterprises (MSMEs), the project will support the Bank's lending to MSMEs and small projects.

ii. Funding structure improvement: This syndicated facility will provide medium to long term funding to the Bank, thereby extending its funding structure and improving its liquidity position.

iii. Access to international markets: The project represents IFC's continuous efforts to introduce leading Mongolian bank to global capital market.

Investment Description
  • International Finance Corporation (IFC)

The Bank, established in 1991, is one of the oldest and largest commercial banks in Mongolia, with total assets of US$ 2.56 billion as of Dec 31, 2015. The bank was a market leader in total loans and customer deposits with 26.6% and 27.3% market share, respectively at the yearend 2015. Through its extensive service network of 545 branches and 583 ATMs, the bank services 2.3 million customers including 388,000 borrowers throughout the country. Khan Bank is rated by Moody’s (B2) and Fitch Ratings (B).

Khan Bank is directly and indirectly owned by Sawada Holdings Co. Ltd (54.4%), a public company listed on Tokyo Stock Exchange. Tavan Bogd Trade Co. Ltd, one of the largest private conglomerates in Mongolia, owns 22.9% and International Finance Corporation (IFC) owns 9.3% of the Bank. Ms. Khulan. D, a Mongolian citizen, owns the remaining 13.3% of the Bank.

Private Actors

The Bank, established in 1991, is one of the oldest and largest commercial banks in Mongolia, with total assets of US$ 2.56 billion as of Dec 31, 2015. The bank was a market leader in total loans and customer deposits with 26.6% and 27.3% market share, respectively at the yearend 2015. Through its extensive service network of 545 branches and 583 ATMs, the bank services 2.3 million customers including 388,000 borrowers throughout the country. Khan Bank is rated by Moody’s (B2) and Fitch Ratings (B).

Khan Bank is directly and indirectly owned by Sawada Holdings Co. Ltd (54.4%), a public company listed on Tokyo Stock Exchange. Tavan Bogd Trade Co. Ltd, one of the largest private conglomerates in Mongolia, owns 22.9% and International Finance Corporation (IFC) owns 9.3% of the Bank. Ms. Khulan. D, a Mongolian citizen, owns the remaining 13.3% of the Bank.

Contact Information

Investment Banking Department, Khan Bank
Seoul Street-25, PO Box-192
Ulaanbaatar-14250, Mongolia
Email Address: investmentbank@khanbank.com
Telephone No.: +976 11 332333
Fax No.: +976 7011 7023

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