1. Supporting Small and Medium- Sized Enterprises Professionally Microbanks in Southeast Europe Dr. Klaus Glaubitt, KfW

2. 1. Shortcomings of the Financial Sector in SEE Banking systems have been misused for non-financial interests Weak banking supervision Lack of qualified financing institutions and adapted credit technologies Lack of refinancing sources  Distrust in local banking sectors restricts mobilization of local deposits  High country risks limit local banks’ access to international capital markets

3. 2. Microbanks with KfW-participation in SEE MicrobanksShare Capital (m€) % Micro Enterprise Bank, BiH78192513-2510 Micro Enterprise Bank, Kosovo716 - Microfinance Bank, Romania1022,51022,5-- Microenterprise Credit, Moldova5201020-1020- FEFAD Bank, Albania7251520-- Microfinance Bank, Yugoslavia1416 - ProCredit Bank, Bulgaria720 --

4. 3. Loan Development of MEBs (II) Number of Loans Total Number of Outstanding Loans = 20,102 FEFAD Albania (March 1999) MEB Bosnia & Herzg. (Nov 1997) Mirobank Romania 4 (Nov 1999) MEC-Bank Moldova 4 (Dec 99) MEB Kosovo (January 2000) MFB Serbia (April 2001) ProCredit Bank Bulgaria (Oct. 2001) 3 1 Loan development includes the seven microbanks in which KfW has an equity participation and includes these microbanks’ entire loan portfolio; 2 2002 only until 30.6.2002; 3 Date microbank opened; 4 started out as finance companies -have obtained full banking licenses in 2002 Source: IPC Microbank data

5. 4. Outstanding Business and Housing Loans MEB Bosnia and FEFAD Albania

6. 0,1%126.1001610,2%66.4101460,3%29.610105 0,0%20.6200-5.2400--- 0,0%24.5800-8.8000--- 1,1%8.20091-4.8200-1.4700 0,1%19.47014-10.5900-3.3100 0,1%24.870320,5%17.660890,6%14.98085 0,1%28.360240,3%19.300570,2%9.85020 As % Outstanding Business Loan Portfolio at Year End (€ '000s) Total Business Loan Write- Offs in Year (€ '000s) As % Outstanding Business Loan Portfolio at Year End (€ '000s) Total Business Loan Write- Offs in Year (€ '000s) As % Outstanding Business Loan Portfolio at Year End (€ '000s) Total Business Loan Write- Offs in Year (€ '000s) September 2002 20012000 Total 5. Write offs vs. Business Loan Portfolio

7. 6. Arrears MEB Bosnia (1999 – 10/2002)

8. 7. Number of Disbursed Loans 2002 MEB Bosnia

9. 8. Volume of Disbursed Loans (in ´000 Euro)

10. 9. Number and Volume of national money transfers MEB Bosnia 2001 – 10/2002

11. 10. Number and Volume of international money transfers MEB Bosnia 2001 – 10/2002

12. 11. Deposit Volume MEB Bosnia (1/2000 – 10/2002)

13. 12. Development of the Number of ATM vs. Cashbox transactions at MEB Kosovo