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Romanian Development Bank privatisation provides vehicle for EBRD to drive Romanian businesses forward
The European Bank for Reconstruction and Development (EBRD) has purchased a 5 per cent shareholding in Romanian Development Bank (RDB), Romania’s second largest bank, for US$ 20.8 million (EUR 20.2 million) from the Romanian State Ownership Fund.
"Through RDB, we aim to intensify our financing of new business in Romania and to provide further services, such as trade finance," said Kurt Geiger, Business Group Director for the EBRD’s Financial Institutions Team. "RDB provides a pivotal platform for the EBRD in promoting new business in Romania. It is the strongest bank in the country. It also has the best record of lending to the real economy and the private sector in particular. We intend to strengthen our relationship with RDB."
In addition to the equity purchase, the EBRD is converting its existing sovereign-guaranteed loan, in to a US$ 45.2 million private sector credit line with a maturity to 2006. To date this credit line has financed 27 companies with an average loan size of US$ 1.2 million
RDB’s network comprises 188 branches across the country. It employs 4,331 employees and has half a million depositors. RDB is generally considered the best managed of the main domestic banks in Romania. This position is expected to be consolidated following its privatisation and the introduction of Société Générale (SG) as a strategic investor. SG acquired a 51 per cent stake earlier this year.
During a visit to Romania in September, the Bank’s President, Horst Köhler, said that the EBRD will support the development of a banking system that strengthens the confidence of depositors and serves the needs of the real economy. In particular, he emphasised the need to reach out to small businesses all over Romania, especially in rural areas.
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