EBRD Thinks Small

PRAGUE -- Getting aid to smaller enterprises must be a primary aim of the European Bank for Reconstruction and Development, or EBRD, in Eastern Europe, its president, Jacques De Larosiere said.

Speaking at a banking forum this week, de Larosiere laid out his medium-term goals for the bank, set up in 1991 to foster the transition from centrally planned to market economies in Eastern Europe and the ex-Soviet Union.

The primary target, he said, must be small and medium-sized enterprises in the private sector.

"This sector will provide the engine for the long-term success of the transition process," he told the pan-European conference of bankers and government officials.

One way to aid private-sector investment would be for the bank to set up more investment funds.

One EBRD-organized fund in Ukraine, set up with a group of international investors, was oversubscribed, raising $12 million against a target of $10 million.

Joint ventures with main area of its work but will be try to stimulate local participation.

EBRD objectives included improving the efficiency of local banks. De Larosiere pointed to its success in the privatization of 11 East European banks, costing the EBRD 111 million European currency units ($97 million) in debt and equity investment.

Privatization of Wielkopolski Bank Kreditowy in Poland was a good example, he said, of where the EBRD had played a key role, taking 28.5 percent of its capital. It was directly involved in improving the bank's efficiency.