Demir Kyrgyz International Bank CJSC (“Demir Bank”) and the International Finance Corporation (IFC) have signed an Agreement under which IFC will invest US$15 million in bonds issued by Demir Bank.
The main purpose of raising funds through bond issuance is to increase access to finance for small and medium-sized enterprises, including those in rural areas. Under the signed Agreement, at least 25% of the funds will be used to support women-owned businesses, reflecting both organizations' commitment to inclusive growth. This will help create between 1,200 and 2,000 direct and indirect jobs over the next five years.
Micro, small and medium-sized enterprises (MSMEs) in the Kyrgyz Republic face a significant financing gap, estimated at 18% of GDP. According to the World Bank Enterprise Survey (2023), less than 22% of formal MSMEs have access to bank finance and 38% are experiencing financial difficulties.
"IFC's investment emphasizes our commitment to support economic diversification, financial inclusion and women's empowerment in the Kyrgyz Republic. By providing long-term local currency financing, we aim to enable small businesses, especially those owned by women, to grow and prosper, contributing to job creation and sustainable economic development in the country," said L. Sevki Sarilar, General Manager of Demir Bank.
"This project reinforces IFC's efforts to enhance economic resilience and access to finance in the Kyrgyz Republic," said Alain Nounke, IFC's Country Manager for Central Asia and Turkey. “The bonds issued by Demir Bank are also expected to support the development of the local capital market, and IFC's involvement will send a strong signal that will help attract other investors to similar initiatives.”
IFC's partnership with Demir Bank is supported by the IDA Private Sector Window program's Local Currency Financing Facility. This partnership is part of IFC's broader strategy to support private business and stimulate economic growth in the Kyrgyz Republic.
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Demir Bank is the first international commercial bank in the Kyrgyz Republic, founded in 1997. Today the financial institution occupies one of the leading positions in the banking system of the republic, providing a wide range of banking services at a high level. For more than a quarter of a century, the bank has implemented dozens of major projects, which today make a significant contribution to the development of the Kyrgyz economy.
The International Finance Corporation (IFC) is an international financial institution, a member of the World Bank Group. It was established in 1965 to ensure a steady flow of private investment in developing countries. IFC's priority in the Kyrgyz Republic is to support the development and diversification of the private sector to improve the country's competitiveness and employment opportunities. For more information, please visit www.ifc.org