EBRD and Khan Bank underwrite heavy machinery company in Mongolia
The European Bank for Reconstruction and Development (EBRD) and local lender Khan Bank are supporting the operations of Mongolia’s leading dealer in heavy duty machinery, Wagner Asia Equipment (WAE), which supplies specialised equipment to the country’s main industry, mining.
In a joint transaction, Khan Bank is providing a loan of up to MNT 84 billion (US$ 29 million equivalent) to WAE, while 33 per cent of the risk on the loan will be shared by the EBRD under a risk sharing facility signed between the two financial institutions.
The funds will allow WAE, a fully owned subsidiary of the Johannesburg Stock Exchange-listed heavy equipment dealer Barloworld, to finance working capital needs, helping the distributor to cope with the impact of the coronavirus pandemic on its operations.
Providing funding in local currency will also limit WAE’s exchange rate risks.
In Mongolia, the EBRD works to help build a diverse economy by developing the private sector and supporting infrastructure improvements.
The Bank has invested more than €1.8 billion in 113 projects in the country since it started operations there in 2006.
