September 13, 2017 / 3:44 PM / a year ago

EBRD loans 50 million euros to Belarus's Belinvest bank

MINSK (Reuters) - The European Bank for Reconstruction and Development will loan 50 million euros ($60 million) to Belarussian state lender Belinvestbank to boost its capital in preparation for privatization, EBRD chief Suma Chakrabarti said on Wednesday.

General view shows the logo on a building of Belinvestbank in Minsk, Belarus October 17, 2016. REUTERS/Vasily Fedosenko

In 2015 the EBRD agreed to buy around 25 percent of the bank, one of the five largest in Belarus, in a sale planned to take place by 2020.

“A decision has been approved to disburse 50 million to the Belarussian government with the aim of it being transferred to Belinvestbank,” Chakrabarti said during a briefing in Minsk.

The original deal marked the first step in EBRD plans to take a more activist role to drive change in the countries it invests in.

The Belarussian state currently controls around 70 percent of the economy and the country has been run on Soviet-style command lines by authoritarian leader Alexander Lukashenko since 1994.

The EBRD has invested almost 1.9 billion euros in Belarus since 1992, but financing has increased in recent years as the country took cautious steps to liberalize its economy and pull itself out of recession.

Chakrabarti said the EBRD had also agreed to provide possible lending in the local rouble currency to small and medium-sized Belarussian enterprises.

Reporting by Andrei Makhovsky; Writing by Alessandra Prentice; Editing by Mark Trevelyan

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