Bishkek (TDI): In a significant move to bolster economic development in Kyrgyzstan, the Asian Development Bank (ADB) has launched its first bond denominated in the country’s currency, the som, raising approximately $5 million.
The three-year bond issue, arranged by Standard Chartered Bank and fully subscribed by Record Currency Management, carries a coupon rate of 10.5%.
This bond issuance is specifically designed to mitigate currency risk for an ADB-backed project aimed at supporting micro and small enterprises (MSEs) in Kyrgyzstan, with a strong emphasis on women entrepreneurs.
The proceeds from this bond will fund loans for MSEs, with at least 40% of the loan allocation earmarked for women-led or women-owned businesses.
These loans will be disbursed through Kompanion Bank, a local financial institution known for its robust rural outreach and long-standing support for women entrepreneurs.
Kompanion Bank has established itself as a key player in empowering women-led businesses across Kyrgyzstan’s rural regions, offering financial and technical support to boost local enterprise.
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Jonathan Grosvenor, ADB’s Assistant Treasurer, highlighted the significance of the bond, stating: “ADB’s maiden Kyrgyz Som bond further expands our local currency footprint and builds on our efforts to deliver foreign exchange risk mitigation solutions in all of ADB’s developing member countries.”
He further noted that this bond issuance reflects ADB’s commitment to fostering financial resilience in its member countries, particularly through local currency financing that reduces the foreign exchange risk often associated with dollar-denominated debt in developing economies.
Since Kyrgyzstan became a member of the ADB in 1994, the bank has committed around $2.6 billion in various forms of financial assistance, including public sector loans, grants, and technical support, to advance development across the country.
ADB’s financing has been pivotal in sectors ranging from infrastructure and energy to social services, agriculture, and financial inclusion, with a focus on projects that address poverty and promote sustainable economic growth.
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The launch of the Kyrgyz som-denominated bond marks a milestone in ADB’s approach to regional development, as it expands its suite of local currency financing options aimed at enhancing financial stability and promoting inclusive growth in its developing member countries.
This latest step aligns with ADB’s broader strategy of mitigating currency risks for local enterprises and creating more resilient economic environments, particularly for underserved populations, including women entrepreneurs and rural communities in Kyrgyzstan.
