The European Fund for Southeast Europe (EFSE) and Deutsche Bank have once again partnered to mobilize private institutional capital for micro and small enterprise (MSE) finance in Southeast Europe and the European Eastern Neighborhood region. Through the placement of two tranches of three-year floating-rate notes in the amount of USD 20 million and EUR 40 million, Deutsche Bank has made the equivalent of EUR 57 million available for private investors to participate in EFSE’s mission of investing in the economic development and prosperity of its target region, Deutsche Bank announced.
By providing funding to local banks and microfinance institutions, EFSE provides key support to MSEs in Southeast Europe and the European Eastern Neighborhood region – a sector that plays a pivotal role in fostering growth and securing employment. As of 31 March 2018, EFSE had outstanding loans of EUR 891 million to nearly 140,000 end-borrowers among MSEs and households. Since its inception, EFSE has financed a total of more than 927,600 loans for an aggregate value of EUR 6.6 billion, and contributed to the creation of well over 760,000 jobs throughout the target region.
EFSE was created in 2005 by the Development Bank KfW (KfW), with financial support from the German Federal Ministry for Economic Cooperation and Development (BMZ) and the European Commission. The privately managed fund is set up as a public-private partnership and registered in Luxembourg. Funding by public investors is complemented by private capital investments, providing a broader and more robust funding platform for development finance.