Ukraine fund capitalises on banking boom

Horizon Capital, a Ukraine-based private equity fund, has bolstered its financial institutions portfolio by acquiring positions in banks in Belarus and Moldova.

Horizon Capital, a Ukrainian private equity manager, has purchased a 25 percent stake in Moldova’s FinComBank and a 31.5 percent interest in MTB, a bank based in the Republic of Belarus – both for undisclosed sums. 

In a statement, Horizon said financial institutions now account for around half of its portfolio at cost. Existing investments include stakes in two Ukrainian banks: IMB Group, where it owns 30.85 percent and ProCredit Bank, where it holds 20 percent. The firm successfully exited Moldova Agroindbank, Moldova’s largest bank, in 2006, and ProCredit Moldova earlier this year.

Alexandru Munteanu, senior vice president of Horizon Capital, said in a statement that FinComBank is “well positioned in the high growth segments of the Moldovan market” and that Horizon was working with management to secure additional debt financing to assist the company’s growth strategy.

At MTB, meanwhile, Horizon will work with a “young” management team to “further develop the bank’s product lines, technologies and processes”. It is also planning to appoint “an international banker with strong experience” to the company’s supervisory board as an independent director.

The banking sector is experiencing a boom in Eastern Europe as banks lend to entrepreneurs and corporates seeking growth, and provide a range of financial services to increasingly affluent populations. Banks in the region are reported to be stronger, better regulated and more profitable than they have ever been before.

Horizon, which invests in mid-cap companies in Ukraine, Moldova and Belarus, manages two funds with over $280 million in total under management: the Emerging Europe Growth Fund and the Western NIS Enterprise Fund.