Mongolia: Senior Loan to Khan Bank for Supporting Micro, Small and Medium-Sized Enterprises

Nonsovereign Project | 47934-001 Status: Active


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Project Name Senior Loan to Khan Bank for Supporting Micro, Small and Medium-Sized Enterprises
Project Number 47934-001
Borrower/Company KHAN BANK
Country Mongolia
Approval Number 7410/3136
Type or Modality of Assistance
7410 Loan USD 40.00 million Committed
Strategic Agendas Environmentally sustainable growth
Inclusive economic growth
Regional integration
Drivers of Change Gender Equity and Mainstreaming
Governance and capacity development
Knowledge solutions
Private sector development
Sector / Subsector

Finance - Small and medium enterprise finance and leasing

Gender Equity and Mainstreaming Some gender elements
Responsible ADB Department Private Sector Operations Department
Responsible ADB Division Portfolio Management Division, PSOD
Responsible ADB Officer Chandrasekera Mudalige Manohari Gunawardhena
Project Sponsor(s)
Objectives and Scope ADB assistance will lead to (i) increased contribution of MSMEs to gross domestic product; and (ii) increased access to credit by MSMEs in Mongolia. Growth of MSMEs in non-mineral-based resource sectors will help diversify and strengthen the resilience of the economy.
Linkage to Country/Regional Strategy An independent evaluation of ADB's assistance to the financial sector was conducted in 2008. Based on the analysis conducted and future challenges and opportunities in the financial sector, recommendations were put forward for future operations. These included (i) considering equity investments and loans to strengthen the operational capacity of Mongolian banks; (ii) using banks to channel credit to address the gap in the supply of rural finance; (iii) providing longer-term loans to meet the needs of MSMEs; and (iv) supporting the development of nonbank and capital market sectors. The proposed assistance to Khan Bank is therefore consistent with the recommendations put forward in this evaluation.

Summary of Environmental and Social Aspects

Environmental Aspects Classified FI environment
Involuntary Resettlement Category C for involuntary resettlement
Indigenous Peoples Category C for indigenous peoples safeguards
Stakeholder Communication, Participation, and Consultation Khan Bank's environmental and social management system will include arrangements to comply with national labor laws and ADB's Social Protection Strategy to ensure adherence to internationally recognized core labor standards, including provisions prohibiting any discrimination against women in hiring and providing equal pay for equal work for men and women. The investment is classified under operations with some gender elements.

Timetable for assistance design, processing and implementation

Concept Clearance -
Due Diligence
Credit Committee Meeting -
Approval -
Last PDS Update 20 Aug 2014

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