The International Finance Corporation (IFC) is proposing a senior unsecured loan of up to $40 million to Azerbaijan’s Unibank Commercial Bank OJSC, aimed at expanding financing for micro, small, and medium-sized enterprises (MSMEs), according to project disclosure seen by CrowdFund Insider.
The proposed financing comprises an IFC A-Loan of up to $20 million for IFC’s own account and a parallel loan of up to $20 million expected to be mobilized from other lenders, primarily international financial institutions.
The loan would have a maturity of up to four years, including a one-year grace period, and could be denominated in U.S. dollars or Azerbaijani manat.
Under the proposed allocation, 20% of IFC’s A-Loan would be earmarked for climate finance, another 20% for women-owned MSMEs and the remaining 60% for MSMEs.
Unibank, headquartered in Baku, provides retail, MSME and corporate banking services. The bank is 94% owned and controlled by Azerbaijani businessman Eldar Garibov.
IFC said the financing is expected to support investments in renewable energy, energy efficiency, clean transportation and climate-smart agriculture while helping address funding constraints faced by smaller businesses.
The project would also provide Unibank with medium-term funding in a market where financing is predominantly short term.
IFC said the longer-dated loan could help the bank diversify its funding base, extend the maturity of its liabilities and better align its funding with the maturity of its assets.
The proposed transaction highlights IFC’s focus on using development finance to deepen lending to underserved businesses while also helping banks in emerging markets access longer-term capital.
