EBRD to loan 50 million euros to Garanti Leasing
LONDONThe EBRD is providing a credit line of €50 million to Garanti Leasing (GL), the second largest leasing company in Turkey, owned by Garanti Bank (GB), to expand leasing services to micro, small and medium-sized enterprises (MSMEs) in the least developed regions.
Garanti Leasing, which has a strong focus on MSMEs and specialized expertise in equipment and machinery leasing, will use the loan to increase the availability of leasing products in the regions, where leasing companies are not very active. EBRD has a long-standing relationship with GL’s parent, GB, with several credit lines promoting MSME finance through agribusiness, energy efficiency and gender-focused initiatives.
MSMEs are integral to the Turkish economy, providing almost 80 per cent of employment and 60 per cent of the country’s exports, but many MSMEs are excluded from traditional bank finance due to high collateral requirements and their lack of credit history. Consequently, for many MSMEs, leasing is an important source of long-term financing for capital investments in specialized equipment. The EBRD sees strong potential to increase the availability of leasing finance to businesses outside of major cities in order to support their growth and development.
Michael Davey, the EBRD’s Country Director for Turkey, said: “This transaction with Garanti Leasing will support a strong partner in improving access to non-bank financial products in the less developed regions, which is in line with the Bank’s strategy to support MSMEs and promote regional financial inclusion in Turkey.”
Ünal Gökmen, the General Manager of Garanti Leasing, said: “Growing our customer base in the regions is a strategic priority for us, and the EBRD loan will help us further this goal.”
To date, the EBRD has invested more than €3 billion in about 100 projects in various sectors of the Turkish economy. Last year Turkey became the EBRD’s second-largest country of operations by business volume, with €1 billion in new investments in 2012 alone.