Countries
Sri Lanka, Indonesia
Local project partner
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German project partner
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Donor
Sparkassen-Finanzgruppe
Duration
2005 - 2007 (Sri Lanka), 2005 - 2009 (Indonesia)
Following the Christmas 2004 tsunami, the German Sparkassenstiftung für Internationale Kooperation launched the Sparkassen Reconstruction Fund for South Asia. A total of four financial institutions were supported in extending loans to affected micro and small entrepreneurs to enable them to rebuild. In this way, more than 8,400 enterprises were helped.
To this end, Sparkassenstiftung intensively advised the partner institutions and provided refinancing funds totalling EUR 9 million for the Sparkassen-Finanzgruppe. Together with the partners' own funds, loans with a volume of almost EUR 13 million were granted.
The design of the refinancing also contributed to the success. For example, the funds were initially made available without interest and then at moderate interest rates. The Savings Banks Finance Group bore the currency risks by agreeing on repayment in local currency. The long-term nature of the refinancing agreement (2005 to 2012) also helped the partner institutions to provide long-term customer loans in line with their needs.
Besides the Indonesian bank BPD Aceh, three Sri Lankan banks were partners in the project:
- Hatton National Bank, one of the largest commercial banks in the country,
- Ruhuna Development Bank, a regional development bank operating in the hard-hit south of Sri Lanka, and
- the non-governmental organisation SEEDS, the largest microfinance institution in the country.
