OREANDA-NEWS. December 04, 2007. In order to strengthen competition in the banking sector of Uzbekistan and to offer private investors a bigger choice, the EBRD is participating in a capital increase of UzKDB Bank with the subscription of up to 22,263 newly issued ordinary shares for $909,170. In total a capital increase of $3,273,000 is expected, which is a 36 percent increase of UzKDB Bank’s existing capital of $12,273,000, reported the press-centre of EBRD.

The capital increase will enable UzKDB Bank to expand its operations in Uzbekistan and also to upgrade its IT systems. The bank will also be able to service more and larger foreign, local and joint venture borrowers from the private sector and reduce their reliance on the state-owned banks.

UzKDB Bank is majority-owned by the Korean Development Bank, a leading bank in South Korea, and a foreign investor in Uzbekistan with a strong commitment to expand operations within the local financial sector.

The EBRD decided in its latest Strategy for Uzbekistan, adopted in July 2005, to focus on the support of private sector investment and entrepreneurship. The Bank also regards the promotion of foreign investment as an important means for developing the private sector.

Fernand Pillonel, Head of the EBRD Resident Office in Tashkent, said the Bank’s participation in the capital increase was “a clear sign of our commitment to continue supporting our partners in Uzbekistan and to remain engaged with a strategic investor such as the Korean Development Bank that is committed to helping the development of Uzbek economy.”

Kim Jang Jin, Chairman of the Board of UzKDB, said KDB’s long term strategy and the shareholders’ decision on March 29, 2007 anticipated an injection of additional capital into UzKDB Bank. “This is further step to develop the relationship between Uzbekistan and Korea which is also reflected in the fact that the capital increase is included in the memorandum signed between both countries earlier this year. The additional capital will allow UzKDB Bank to strengthen its further development and to expand its business into the regions.”