Finnfund invests EUR 15 million in Bank Respublika to support green finance and MSMES in Azerbaijan

Finnfund is investing EUR 15 million equivalent in Azerbaijani manat in Bank Respublika, the largest privately owned bank in Azerbaijan.

The senior unsecured loan will support the growth of Bank Respublika’s green financing and lending to micro, small and medium-sized enterprises (MSMEs).

30% of the total financing will be directed to women, making the investment aligned with the 2X Challenge on gender equality.

Bank Respublika is a systemically important financial institution and the fifth-largest bank in Azerbaijan, with a strong focus on retail, micro and SME clients. Its loan portfolio is well diversified and notably excludes exposure to the oil and gas sector.

The investment will contribute to increasing financial inclusion in Azerbaijan, where access to formal financing remains limited, particularly for MSMEs and individuals outside major urban areas. At the same time, it supports the country’s efforts to diversify its economy and expand green finance.

“This investment combines climate action, gender equality and financial inclusion in a highly tangible way. By providing local currency financing to a leading bank focused on MSMEs and green lending, we can help channel funding to underserved segments while supporting Azerbaijan’s transition towards a more diversified and sustainable economy,” said Ulla-Maija Rantapuska, Senior Investment Manager at Finnfund.

Tariyel Ismayilov, Chairman of the Management Board of Bank Respublika, said: “We highly value the start of our cooperation with Finnfund and view the signing of this agreement as another important step in strengthening our collaboration with international financial institutions. Support from one of Finland’s leading development finance institutions is a recognition of Bank Respublika’s resilience, the effectiveness of our business model, and our commitment to responsible financing principles. The funds attracted under this agreement will enable us to further expand support for entrepreneurs and projects contributing to the sustainable development of Azerbaijan’s economy.”

Bank Respublika has an established track record of profitability and strong asset quality, as well as partnerships with several international financial institutions. The new financing will further strengthen its capacity to expand lending to priority segments and scale up green finance. This investment also marks a milestone for Finnfund as its first synthetic local currency loan, demonstrating the organisation’s commitment to deploy value adding financial solutions in emerging markets.

More information:
Ulla-Maija Rantapuska, Senior Investment Manager, Finnfund
tel +358 41 536 5631, ulla-maija.rantapuska@finnfund.fi

Media contact:
Valpuri Mäkinen, Senior Communications and Marketing Manager, Finnfund
tel +358 50 384 2105, valpuri.makinen@finnfund.fi

About Bank Respublika
Bank Respublika, established in 1992, is one of the five leading banks in Azerbaijan. The Bank is recognized for its strong financial performance, customer-focused approach and commitment to supporting the country’s economic development. Its shareholders include Germany’s largest financial institution, Sparkassen International Development Trust, a member of the Sparkassen-Finanzgruppe, one of Europe’s largest financial groups. Today, Bank Respublika serves individuals, SMEs and corporate clients through a nationwide network of branches and digital banking channels.

About Finnfund
Finnfund is a Finnish development financier and impact investor. Finnfund builds a sustainable future and generates lasting impact by investing in businesses that solve global development challenges with Finnish added value. Each year, we invest 200–250 million euros in 20–30 companies in developing countries. Our focus is particularly on digital infrastructure and solutions, clean energy, forestry, agriculture, and on providing funding for small and medium-sized enterprises through financial institutions. Today, Finnfund’s investments, commitments, and investment decisions total about 1.2 billion euros. The company has about 100 employees based in Helsinki and Nairobi.