AMMAN — The European Bank for Reconstruction and Development (EBRD) is providing Bank al Etihad (BAE) with a $35 million Basel III compliant subordinated loan to strengthen its lending capacity for businesses, individuals as well as women-led micro, small- and medium-sized enterprises (MSMEs) in Jordan.

The financing package consists of up to $25 million to BAE for on-lending to businesses and individuals in Jordan, and up to $10 million for on-lending to women-led MSMEs under the EBRD Women in Business programme in Jordan.

The programme will help BAE to adapt its products to better suit women-led MSMEs, strengthen their lending practices and improve marketing and product development, according to a statement from the EBRD.

In Jordan, MSMEs account for 98 per cent of all businesses, contributing significantly to economic growth and job creation. Women-led businesses account for 25 per cent of the SME sector in Jordan, yet they are underfinanced, the statement said.

This new financing to BAE is the first project in the southern and eastern Mediterranean (SEMED) region to incorporate the EBRD’s Paris alignment methodology in the financial sector.

A technical assistance package provided under the EBRD’s Corporate Climate Governance Facility will assist BAE in developing a pilot institutional transition plan to align its business practices and financial flows with the goals of the Paris Agreement, integrating climate risk considerations, identifying business opportunities and supporting its clients with low carbon products and services, the statement said.

Bank al Etihad was incorporated in 1978 and has since grown to become one of the leading banking groups in Jordan. It ranks third in Jordan in terms of customer deposits and facilities, and fourth in terms of total assets.

Since 2012 the EBRD has provided more than 1.9 billion euros through 68 projects in Jordan, 70 per cent of which are in the private sector, including financial support to the Jordanian banking sector through MSME loans, subordinated debt and trade finance facilities.

© Copyright The Jordan Times. All rights reserved. Provided by SyndiGate Media Inc. (Syndigate.info).