EBRD, Turkish bank sign $112M financing agreement

The European Bank for Reconstruction and Development (EBRD) and the Industrial Development Bank of Turkey (TSKB) signed an agreement to provide €100 million (nearly $112 million) financing for Turkish businesses.

The EBRD and the TSKB will provide €50 million (some $56 million) each for the lending package for private industrial companies, according to a press release on Tuesday.

"The EBRD will share the risk of up to 50% of each individual sub-loan provided to eligible businesses identified jointly by the two lenders," the European Bank said.

The agreement was signed by Jurgen Rigterink, the EBRD first vice president, and Suat Ince, chief executive officer of TSKB.

During the signing ceremony, Rigterink stressed the EBRD's continued commitment to Turkey at a critical time when banks' lending capacity is limited.

"This is likely to slow down the country's economic recovery. We expect the Turkish economy to start to pick up by 2020," he underlined.

The EBRD said that clients would be able to use these loans to finance working capital, capital expenditure and refinance existing loans.

Ince stressed that financial support for the private sector is a key factor for the current rebalancing process in Turkey.

As a leading institutional investor in Turkey, the EBRD has invested more than €11 billion ($12.3 billion) in over 280 projects in the country since 2009.