FIF - CA YiB - XacBank YiB Syndicated Loan

Overview
Project Summary Document
Environmental and Social Documentation
Procurement
Complaints

Overview

The provision of a senior loan of up to US$ 40 million (A-Loan) to XacBank JSC (XB) under the Youth in Business Programme in Central Asia (YiB CA Programme), aimed at financing private micro, small, and medium-sized Enterprises (MSMEs) in Mongolia. Subject to market conditions, the Bank will seek to raise an additional amount of up to US$ 107 million (B-Loan) for the account of participants.

Project ID 55861

Status Signed

Location

Mongolia

Business Sector

Financial Institutions

Notice Type

Private

Project timeline

Exploratory
Passed Concept Review
Passed Structure Review
Passed Final Review
Board Approved
Signed
Implementing
Completed

Company Contact Information

Mr Erdenebayar Ganzorig
erdenebayar.g@xacbank.mn
+(976) 7577-1888 (+826)
+(976-11) 328701
https://www.xacbank.mn/en
XacBank HQ Bldg, Ulaanbaatar-14200, Post Branch 20A, PO Box-72, MONGOLIA

Project ID 55861

Status Signed

Location

Mongolia

Business Sector

Financial Institutions

Notice Type

Private

Environmental Category

Approval Date

29 Jan 2025

Disclosure date

25 Dec 2024

FIF - CA YiB - XacBank YiB Syndicated Loan (Mongolian) (PDF, 0.40MB)

Project Description

Project Objectives

The proposed loan will enable XB to (i) support youth led/owned MSMEs in overcoming the consequences of the challenging market environment and increasing their resilience and adaptability; (ii) diversify its funding base; and (iii) launch a new product encompassing both financing and nonfinancial services (NFS) targeted at young entrepreneurs, which will increase their access to finance.

Transition Impact

ETI score:71

: 71
The Project will contribute to the YiB CA Programme's objectives and support its Inclusive (Primary) and Competitive (Secondary) qualities. The facility is expected to increase lending to youth MSMEs, facilitate XB's capacity building and promote the transfer of skills to young business owners/managers in the country.

Client Information

XAC BANK JSC

XB is the fourth-largest commercial bank in Mongolia with total assets of US$ 1.7 billion, a net loan portfolio of US$ 975 million, and a market share of approximately 8.8 per cent. As a universal bank, XB primarily focuses on MSME and retail lending and operates nationwide with 71 branches.

EBRD Finance Summary

USD 40,000,000.00

A senior loan of up to US$ 40 million (A-Loan)

Total Project Cost

USD 147,000,000.00

The raising of an additional amount of up to US$ 107,000,000 (B-Loan) for the account of participants will be on a best effort basis and is subject to market conditions.

Additionality

Financing structure:
The EBRD remains one of the few institutions, providing long-term funding in Mongolia. The provision of a 3-year funding will better meet sub-borrowers demand for longer-tenor loans, especially the ones with investment-type use of proceeds, which can be in particular demand of youth entrepreneurs.

Innovative financing structures and/or instruments:
The Project will benefit from the First Loss Risk Cover ("FLRC") and the Result-Based Compensation ("RBC"), which are tailor-made and innovative instruments in the Mongolian market. FLRC and RBC are intended to support XB in offering lower or more flexible collateral requirements.

Standard setting: helping projects and clients achieve higher standards:
Through a combination of elements (financing; FLRC; RBC; and TC), the YiB CA Programme helps clients raise their inclusive financing standards by generating a better awareness and understanding of the needs of the underserved segment of young entrepreneurs. Furthermore, the comprehensive TC package supports clients in adapting their products and delivery mechanisms to better suit the needs of young entrepreneurs, thus allowing XB to use the potential of the segment and accelerating its financial inclusion.

Knowledge, innovation and capacity building:
The YiB CA Programme includes extensive capacity building, comprising training, advisory support for Participating Financial Institutions and for youth MSMEs through ASB activities, allowing all parties to access and benefit from knowledge and expertise that may not be present in the local market.

Technical Cooperation and Grant Financing

The YiB CA Programme includes three TC components:

i. Tailored capacity-building for XB. Funding source: the EBRD Shareholders Special Fund ("SSF").

ii. Capacity-building for Youth MSMEs via the Advice for Small Businesses (ASB). Funding source: SSF.

iii. A tailored-made TC to conduct a cybersecurity gap analysis of XB. Funding source: Taipei China.

Co-investment grants / Concessional Finance

i. First Loss Risk Cover in favour of XB: up to 5 per cent of the A-Loan limited to 70 per cent per a single sub-loan. Funding status: the funding is envisaged to come from both the EU "Building Crisis-resilient SMEs in Mongolia post Covid-19" and SSF.

ii. Result-based Compensation in favour of XB: up to 3 per cent of the A-Loan to partially compensate the client for the up-front investments related to building a sustainable YiB lending expansion. Funding source: SSF.

Company Contact Information

Mr Erdenebayar Ganzorig
erdenebayar.g@xacbank.mn
+(976) 7577-1888 (+826)
+(976-11) 328701
https://www.xacbank.mn/en
XacBank HQ Bldg, Ulaanbaatar-14200, Post Branch 20A, PO Box-72, MONGOLIA

PSD Last Updated

24 Mar 2025

Understanding transition

Further information regarding the EBRD’s approach to measuring transition impact is available here.

Business opportunities

For business opportunities or procurement, contact the client company.

For business opportunities with the EBRD (not related to procurement) contact:

Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com

For state-sector projects, visit EBRD Procurement:

Tel: +44 20 7338 6794
Email: procurement@ebrd.com

General enquiries

Specific enquiries can be made using the EBRD Enquiries form.

Environmental and Social Policy (ESP)

The ESP and its associated Environmental and Social Requirements (ESRs) set out the ways in which the EBRD implements its commitment to promoting “environmentally sound and sustainable development”. The ESP and the ESRs include specific provisions for clients to comply with the applicable requirements of national laws on public information and consultation, and to establish a grievance mechanism to receive and facilitate resolution of stakeholders’ concerns and grievances, in particular, about the environmental and social (E&S) performance of the client and the project. Proportionate to the nature and scale of a project’s environmental and social risks and impacts, the EBRD also requires its clients to disclose information, as appropriate, about the risks and impacts of projects or to undertake meaningful consultation with stakeholders and consider and respond to their feedback.

More information on the EBRD’s practices in this regard is set out in the ESP.

Integrity and compliance

The EBRD's Office of the Chief Compliance Officer (OCCO) promotes good governance and ensures that the highest standards of integrity are applied to all of the Bank's activities in accordance with international best practice. Integrity due diligence is conducted on all Bank clients to ensure that projects do not present unacceptable integrity or reputational risks to the Bank. The EBRD believes that identifying and resolving issues in the project assessment and approval stages is the most effective means of ensuring the integrity of Bank transactions. OCCO plays a key role in these protective efforts andhelps to monitor integrity risks in projects post-investment.

OCCO is further responsible for investigating allegations of fraud, corruption and misconduct in EBRD-financed projects. Anyone, either within or outside the Bank, who suspects fraud or corruption should submit a written report to the Chief Compliance Officer by email to compliance@ebrd.com. OCCO will follow-up all matters reported. It will review all matters reported. Reports can be made in any language of the Bank or of the Bank's countries of operation. The information provided must be made in good faith.

Access to Information Policy (AIP)

The AIP, which entered into force on 1 January 2025, sets out how the EBRD discloses information and consults with its stakeholders to promote better awareness and understanding of its strategies, policies and operations. Please visit the Access to Information Policy page to find out what information is available from the EBRD website.

Specific requests for information can be made using the EBRD enquiries form.

Independent Project Accountability Mechanism (IPAM)

If efforts to address environmental, social or public disclosure concerns with the Client or the Bank are unsuccessful (for example, through the client’s project-level grievance mechanism or through direct engagement with Bank management), individuals and organisations may seek to address their concerns through the EBRD’s Independent Project Accountability Mechanism (IPAM).

IPAM independently reviews project issues that are believed to have caused (or to be likely to cause) harm. The purpose of the mechanism is: to support dialogue between project stakeholders to resolve environmental, social and public disclosure issues; to determine whether the Bank has complied with its Environmental and Social Policy or the project-specific provisions of its Access to Information Policy; and where applicable, to address any existing non-compliance with these policies, while preventing future non-compliance by the Bank.

Please visit the Independent Project Accountability Mechanism webpage to find out more about IPAM and its mandate and how to submit a Request for review. Alternatively, contact IPAM by email at ipam@ebrd.com for guidance and more information on IPAM and how to submit a request.

Environmental and Social Documentation is not available for this project.

Selected procurement notices related to this project may be shown below. Further procurement opportunities related to this and other projects, if available, maybe be viewed in the EBRD Procurement Portal.

The EBRD's Environmental and Social Policy (ESP), Access to Information policy (AIP) and Project Accountability Policy (PAP) enable sound and sustainable development in its projects. The Independent Project Accountability Mechanism (IPAM) deals with complaints about environmental, social and disclosure matters related to the Bank’s investments.

No complaints about this project have been made so far.

Our story

How we invest in changing lives

What we offer for businesses

Search

FIF - CA YiB - XacBank YiB Syndicated Loan

Overview

Project timeline

Company Contact Information

Project Description

Project Objectives

Transition Impact

Client Information

EBRD Finance Summary

Total Project Cost

Additionality

Technical Cooperation and Grant Financing

Company Contact Information

PSD Last Updated

Understanding transition

Business opportunities

General enquiries

Environmental and Social Policy (ESP)

Integrity and compliance

Access to Information Policy (AIP)

Independent Project Accountability Mechanism (IPAM)

FIF - CA YiB - XacBank YiB Syndicated Loan

Overview

Company Contact Information

Project Description

Project Objectives

Transition Impact

Client Information

EBRD Finance Summary

Total Project Cost

Additionality

Environmental and Social Summary

Technical Cooperation and Grant Financing

Company Contact Information

PSD Last Updated

Understanding transition

Business opportunities

General enquiries

Environmental and Social Policy (ESP)

Integrity and compliance

Access to Information Policy (AIP)

Independent Project Accountability Mechanism (IPAM)