IFC to invest $ 5 mn in Poland’s first microfinance bank

Microfinance Focus, Aug. 05, 2009: IFC, a member of the World Bank Group, today announced that it will invest $5 million in Poland’s first microfinance bank to support the microfinance sector and improve access to finance for micro and small businesses.

FM Bank, which recently received a commercial banking license, will be established from the operations of Fundusz Mikro, a successful Polish microfinance institution with 40 branches across the country. As a full-fledged bank, FM Bank will be able to mobilize deposit funding, allowing it to widen the range of products offered to micro and small businesses. It also will be able to decrease its cost of funding, making microfinance loans more affordable. IFC’s investment will give it a 10 percent equity share in the bank.

“Poland has a diverse and active microenterprise sector but it is not well served by traditional banks—and FM Bank wants to change that,” said Henryk Pietraszkiewicz, Acting President of FM Bank. “Our focus will be on providing tailored service and products for micro and small entrepreneurs. We welcome IFC’s investment and strong support in this endeavor.”

André Laude, IFC Chief Investment Officer, said, “IFC is delighted to support Poland’s first microfinance bank and we welcome this significant step in the development of the country’s microfinance sector. Providing affordable credit and other financial services to small businesses will promote the development of an active private sector, generate jobs, and help reduce income disparities.”

IFC is one of the  leading global investors in microfinance with commitments of $1.2 billion. At the end of 2008, IFC’s microfinance clients disbursed 20 million micro loans totaling $25 billion, report said.

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