EBRD launches portfolio risk-sharing product in Kosovo

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  EBRD will cover up to 50 per cent of the credit risk on a loan portfolio of up to €25 million
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  The guarantee will facilitate new lending by Raiffeisen Bank Kosovo to micro, small and medium-sized enterprises
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  First loss risk cover provided by Norway under the Western Balkans Growth Support Programme

The European Bank for Reconstruction and Development (EBRD) is signing the first portfolio risk-sharing facility in Kosovo with Raiffeisen Bank to unlock €25 million of new finance for micro, small and medium-sized enterprises (MSMEs). Around 20 per cent of the facility will be used for Green Economy Transition (GET) eligible technologies.

The Bank is providing a guarantee of up to €12.5 million, which will effectively cover up to 50 per cent of the credit risk on a €25 million loan portfolio held by Raiffeisen Bank Kosovo.

The agreement will include a first loss risk cover provided by Norway under the Western Balkans Growth Programme, a regional initiative that aims to increase access to finance for small businesses in the region.

This newly introduced financial product in Kosovo is designed to lower the risk on partner financial institutions and address the financing gap for MSMEs, which are the backbone of the country’s economy.

Specifically, it will allow Raiffeisen Bank Kosovo to relieve capital and channel excess liquidity into new lending with its own funds, maximising their impact on the local market.

Sergiy Maslichenko, the EBRD’s Head of Kosovo, said: “We are excited to explore innovative ways to support small businesses in Kosovo, a key segment of the local economy. This new financial product empowers Raiffeisen Bank Kosovo to maximise its impact by directing more of its own resources to local MSMEs. As a trusted EBRD partner, they are the natural choice to help us expand the range of financial solutions available in Kosovo.”

Raiffeisen Bank Kosovo, headquartered in Pristina, is the largest commercial bank in the country and a longstanding EBRD partner, having implemented projects funded by the Bank since 2006. It offers a wide range of products to private individuals, MSMEs and large corporates, while preserving a focus on green investments in Kosovo.

Anita Kovacic, CEO of Raiffeisen Bank Kosovo, added: “This new agreement further strengthens our capacity to support MSMEs, which play a vital role in driving Kosovo’s economic growth. We are pleased that our longstanding partnership with the EBRD is not only contributing to economic development but also helping to advance the country’s green transformation.”

The EBRD is a leading institutional investor in Kosovo, having invested €692 million through 115 projects there to date.