According to IFC website, the proposed investment is a syndicated subordinated debt facility to XacBank, an existing partner of IFC and the fourth largest bank in Mongolia. It will include IFC’s own account exposure of up to US$10 million and mobilization of up to US$35 million. The proposed investment intends to provide the needed Tier-2 capital to strengthen the Bank’s capital structure, and to enable it to provide 3,600 to 8,000 additional loans to micro, small and medium enterprises in the country.
i) Project Outcomes: to strengthen capital position of a systemic bank in Mongolia, enabling it to provide 3,600 to 8,000 additional loans to Mongolian MSMEs and to improve access to finance. IFC expects the Bank's MSME loans to increase from the current 30% of its total loan portfolio to 40% by the end of the project period.
ii) Economy-wide Effects: to deliver economy-wide effect through providing additional financing to MSMEs that will increase economic activity and job creation.
iii) Contribution to Market Creation: to improve market competitiveness by motivating other players to increase lending to MSMEs.
XacBank is a commercial bank in Mongolia, offering retail, microfinance, SME and corporate banking services. As of December 31, 2017, the Bank had total assets of MNT3.0 trillion, and total shareholders’ equity MNT201.2 billion. It has 82 branches, 139 ATMs and about 1,286 staff across the country.
XacBank is wholly owned by TenGer Financial Group LLC (“TFG”), which is a Mongolian financial service holding company offering banking (XacBank), financial leasing (XacLeasing), insurance (Tenger Insurance) and micro credit services through its subsidiaries. Shareholders of TFG include Mongolyn Alt (MAK) LLC (20%), IFC (17.17%), ORIX Corporation (16.81%), European Bank for Reconstruction and Development (12.91%), National Bank of Canada (10.52%), RONOC (10.15%), Mongolia Opportunities Partners (6.63%), Triodos Fair Share Fund (3.73%) etc.
Project Contact: Erdenebayar Ganzorig
Telephone No.: +976 7577-1888 ext.826
Email Address: email@example.com
Office Address: XacBank HQ Bldg, Ulaanbaatar-14200, Post Branch 20A, PO Box-72, Mongolia.
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