Luxembourg and Yerevan, 9 January 2024 – The Green for Growth Fund (GGF), an impact investment fund advised by Finance in Motion, is re-engaging with the leading Armenian SME bank ARARATBANK through the provision of a USD 5 million loan facility. In a significant move to drive sustainable development in Armenia, this strategic partnership with ARARATBANK aims to broaden the network of GGF partners on the ground and provide critical support for green lending initiatives directed at SMEs and retail clients.
The funding will help the Bank in meeting the growing demand for green capital expenditures in key sectors, such as agriculture, food processing, manufacturing, and construction. Additionally, it will support individual households in adopting energy efficient systems and eco-friendly practices, including the implementation of small renewable energy measures.
The Fund’s support extends beyond financing, incorporating a dedicated Technical Assistance (TA) package that is designed to augment ARARATBANK’s capacity for green lending by utilizing GGF’s vast experience and expertise in the field. This aligns with GGF's broader mission to promote sustainable finance practices and underscores a holistic approach to support ARARATBANK’s commitment to green initiatives.
Christopher Knowles, Chairperson of the GGF, expressed enthusiasm about the Fund’s re-engagement with ARARATBANK, stating: “We are very pleased to deepen our collaboration with ARARATBANK, a partner that shares our commitment to driving sustainable development. This loan investment showcases the potential for positive change through collective efforts and highlights our joint commitment to improving energy and resource efficiency to accelerate the country’s green transition.”
Mher Ananyan, Chairman of the Executive Board of ARARATBANK, commented: "We are thrilled to announce our collaboration with the Green for Growth Fund in providing 5 million USD to support small and medium-sized enterprises (SMEs) in their journey towards energy efficiency and renewable energy solutions. This partnership reflects our unwavering commitment to UN Global Principle 8, which urges businesses to undertake initiatives that promote greater environmental responsibility. By empowering SMEs to adopt sustainable practices, we are not only fostering a greener future but also driving economic growth and resilience. Together, we can make a tangible impact on the environment and contribute to a more sustainable world for generations to come.”
ABOUT THE GGF
The Green for Growth Fund invests in measures designed to cut energy use and CO2 emissions and improve resource efficiency in 19 markets across Southeast Europe, the Caucasus, Ukraine, Moldova, the Middle East and North Africa. The Fund provides such financing directly to renewable energy projects, corporates and municipalities or indirectly via selected financial institutions. The GGF’s Technical Assistance Facility maximizes the fund’s investment impact through support for capacity building at local financial institutions and partners.
The GGF was initiated as a public-private partnership in December 2009 by Germany’s KfW Development Bank and the European Investment Bank, with financial support from the European Commission, the German Federal Ministry for Economic Cooperation and Development, the European Bank for Reconstruction and Development, and the Austrian Development Bank (OeEB). The fund’s growing investor base comprises donor agencies, international financial institutions and institutional private investors, including the International Finance Corporation, the Dutch development bank FMO, and the German ethical bank GLS. The GGF is advised by Finance in Motion GmbH. MACS Energy & Water GmbH, Frankfurt am Main acts as the technical advisor.
About Finance in Motion
Finance in Motion is a global impact asset manager focused exclusively on sustainable development in emerging markets and developing economies. The company structures, manages, and advises impact investment funds that bring together public and private investors to address climate change, strengthen biodiversity conservation, foster the sustainable use of natural resources, improve livelihoods, and promote economic opportunities.
Founded in 1991, ARARATBANK OJSC is one of the leaders in the Armenian banking sector, providing the latest and highest quality banking services to both individuals and legal entities, applying cutting-edge technologies and creating a special business culture in bank-client relations.
With the innovative banking technologies and best practices of corporate governance, the bank has 50 branches across the country. ARARATBANK actively participates in the real sector of Armenian economy, particularly in SME lending. ARARATBANK cooperates with 17 reputable international financial institutions.
Media contact GGF
Marketing & Communications
Phone: +352 691 336 439
Media contact ARARATBANK
Advisor on Public Relations
to the Executive Director of AraratBank
Phone: +374 10 59 23 23 (extension number - 8015)