WASHINGTON, DC, December 2, 2008 — The Multilateral Investment Guarantee Agency (MIGA), the political risk insurance arm of the World Bank Group, said today it has issued a guarantee covering UniCredit Bank Austria AG’s $90.3 million shareholder loan to the Closed Joint Stock Company UniCredit Bank in Russia. The guarantee will allow the UniCredit Group to finance its local subsidiary and is particularly important in view of the current turmoil in financial markets worldwide. It will also help enable SMEs in the region to receive credit at a time when financing is scarce for business growth.
“No country is immune to the impacts of the global financial crisis,” said Shigeo Katsu, World Bank Vice President for Europe and Central Asia. “The guarantees issued by MIGA will help support the banking sector in Russia at a time when banks in emerging markets and transition economies are reeling from ebbing global liquidity and free-falling stock markets.”
MIGA’s support for the banking sector in Russia is consistent with the World Bank Group’s efforts to help countries strengthen their economies, bolster fi-nancial systems, maintain growth and protect the most vulnerable. MIGA has supported several other guarantees in the Russian Federation in a wide range of sectors, including infrastructure, mining, manufacturing and finan-cial sector. In the financial sector, MIGA has supported various investments in leasing, banking and mortgage financing.
The agency’s guarantees help mitigate noncommercial risks to investments, encouraging lenders and investors to invest in emerging markets and transition economies and inject much-needed liquidity in these markets.
“MIGA’s products and services are more critical than ever before at times like this to bolster confidence in the financial sector,” said James Bond, Acting Executive Vice President and Chief Operating Officer of MIGA. ”By providing guarantees to cover loans to banks, MIGA can help address the economic and financial vulnerabilities of these countries in the wake of the global crisis.”
Similar guarantees are expected from MIGA for projects in other Eastern Eu-ropean and other regions. To find out more about MIGA’s support for the fi-nancial sector, visit www.miga.org.
MIGA was created in 1988 as a member of the World Bank Group to promote for-eign direct investment into emerging economies to support economic growth, reduce poverty, and improve people’s lives. MIGA fulfills this mandate by offering political risk insurance (guarantees) to investors and lenders, covering risks including expro-priation, breach of contract, currency transfer restriction, and war and civil distur-bance. MIGA works actively with investors and host countries, helping to resolve disputes before they reach a claims situation. The agency also offers technical assis-tance to its member countries and provides free online investment information ser-vices. Since its inception, MIGA has supported nearly 600 projects in 100 develop-ing countries, totaling $19.5 billion in coverage. MIGA’s gross exposure stands at $6.5 billion.
|
RSS