(MENAFN- Trend News Agency) BAKU, Azerbaijan, November 19. The European Bank for Reconstruction and Development (EBRD) and AXA XL have launched a new framework designed to channel more private capital into lending for financial institutions across the EBRD's regions, Trend reports via the EBRD.

Under the Financial Institutions Portfolio Programme (FIPP), AXA XL will commit 150 million euros in credit risk insurance on an unfunded basis. The structure gives every eligible transaction an automatic 25% risk participation, allowing the EBRD to scale up activity without seeking individual insurer approval.

The EBRD said the program's simplified operating model and pre-agreed eligibility rules will accelerate risk-sharing while maintaining strong controls. The portfolio approach mirrors structured co-lending mechanisms used by other development institutions and complements the bank's existing unfunded risk-participation tools.

By increasing its capacity to share risk, the EBRD aims to expand lending to partner financial institutions that on-lend to micro, small and medium-sized enterprises, women-led businesses and projects supporting green technology.

“FIPP is designed to give our partner banks faster execution and greater certainty,” said Christian Kleboth, the EBRD's head of debt mobilisation.“With AXA XL's committed unfunded support and pre-agreed criteria, we can channel private-sector risk sharing where it's needed, when it's needed.”

AXA XL said the program will help diversify its credit risk insurance portfolio while supporting development finance.“The program is a highly efficient tool for mobilising private-sector insurance capital towards development finance,” said Ian Nunn, head of political risk, credit and bond for AXA XL's UK and Lloyd's unit.

The EBRD is one of the largest mobilisers of private capital in its regions, helping unlock 26.8 billion euros of investment in 2024.

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