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EBRD extends ECU 8 million loan to Estonian Investment Bank
Small and medium-scale enterprises in Estonia will have easier access to credit resources as a result of a loan agreement signed last Friday between the European Bank for Reconstruction and Development (EBRD) and the Estonian Investment Bank (EstIB) which is a special credit institution in Estonia.
The loan is for ECU 8 million and will be used by EstIB to support medium and long-term capital investment projects and start-up working capital requirements. The borrowers are private sector companies or companies undergoing privatisation in the industrial, export and financial sectors.
Ron Freeman, First Vice President of the EBRD said: "This loan will allow EstIB to increase financing to the Estonian private sector. It will also build EstIB's track record as a reliable borrower and enable it to attract further future funding on commercial terms."
The loan consists of two consecutive tranches of ECU 4 million each -of which 50% is funded by the Baltic Investment Special Fund and 50% from the Bank's own capital resources.
EstIB was established in July 1992 with the Bank of Estonia as founding shareholder. Its main objective is to mobilise funds for on-lending to private small and medium scale enterprises in Estonia. Since November 1992, EBRD holds 33.3% of the share capital of EstIB with the Bank of Estonia holding the remaining 66.6%.
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