The European Bank for Reconstruction and Development (EBRD) is fostering the development of Georgia’s fledgling leasing market by cooperating with TBC Leasing. The bank is providing a five-year US$3mn loan to the company for making leases to privately-owned Georgian enterprises and is acquiring 10% of its shares to support efficiency and skills development.
In Georgia, where the leasing sector is in the early stages of development, the company is one of only three to have started operating. As Georgia’s economy has improved in the past two years, demand for leasing has increased.
For 2006 the potential demand for leases is forecast to exceed US$22mn. A healthy leasing industry will help bring increased flows of financing to the productive sector of the economy and facilitate the growth of domestic production. TBC Leasing’s target market is small and medium-sized enterprises which will benefit from asset-based finance to extend their business activities.
The EBRD claims it is committed to supporting the development of the non-bank financial sector in Georgia. As well as supporting the leasing industry, this investment will support the private-sector small and medium-sized enterprises seeking leasing contracts from TBC Leasing.
TBC Leasing, which was set up in September 2003, is a wholly-owned subsidiary of JSC TBC Bank, the largest bank by assets in Georgia.