Romanian lender Agricover Credit, wich specializes in financing agriculture businesses, will get a EUR 10 million loan from the International Investment Bank (IIB), a regional development bank headquartered in Moscow.

The seven-year loan will allow Agricover Credit to increase its available financial resources and increase its lending capacity. The non-banking financial institution, which is part of local agriculture group Agricover, aims to increase its lending activity and to add more clients this year.

“The agreement we signed today will allow us to keep the fast pace in developing new innovative financial products and services, in support of a modern and sustainable agriculture. This way, we will support small and medium-size farmers by facilitating their access to the funds they need for growing their productivity and generating added value,” said Robert Rekkers, CEO of Agricover Credit.

Rekkers, a Dutch banker that helped build Banca Transilvania, the third largest bank in Romania, took over as CEO of Agricover Credit in July 2012 and managed to turn it into one of the largest lenders in the agriculture sector. In 2014, the company granted loans totaling some EUR 188 million, 30% more than in 2013, serving 1,550 clients.

The higher activity in Romania’s agriculture sector supported the lender’s growth, as local farmers invested more in modernizing their farms and in new technologies that would increase their efficiency, Rekkers explained.

“By the end of this year our goal is to reach 2,000 clients. We target not only big companies but also small and medium-sized agriculture businesses,” Rekkers told Romania-Insider.com. He added that the average value of loans granted by Agricover Finance was up to EUR 100,000.

The company has some EUR 27 million capital from its shareholders and EUR 35 million worth of financing lines from international financing institutions. It can also access more than EUR 100 million funds from local banks at any time to grant financings.

“Securing a high-caliber partner such as International Investment Bank acknowledges the fact that we have a solid business model and the right development strategy. The signing of this agreement strengthens our position as a major player in this market segment in Romania”, said Rekkers.

The International Investment Bank is a regional development bank headquartered in Moscow, Russia. It was founded in 1970 and its current shareholders are Bulgaria, Cuba, the Czech Republic, Mongolia, Romania, Russia, Slovakia and Vietnam. The bank re-launched in late 2012. By December 2014, it has granted EUR 311 million worth of loans to companies in the eight member states, but it aims to reach EUR 1.2-1.5 billion in new financings in the following years.

In Romania, the IIB also offered a EUR 10 million financing to BT Leasing, which is part of Banca Transilvania group. The bank plans to increase its presence in the local market.

“The IIB aims to further continue expanding its operations in Romania and to promote Romania’s economic development,” said Vladimir Liventsev, Deputy Chairman of the IIB’s Board responsible for loans and investments.

Andrei Chirileasa, andrei@romania-insider.com