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EBRD and Pol'nobanka increase assistance for the Slovak agribusiness sector
To provide further support to the Slovak farming community, the European Bank for Reconstruction and Development (EBRD) has signed a co-financing agreement with Pol’nobanka for DM 40 million (EUR 20.5 million). This follows the successful implementation of a similar facility last year, where the EBRD and Pol’nobanka financed 168 sub-loans backed by the newly created security of warehouse receipts. The EBRD’s financing of DM 20 million (EUR 10.3 million) will be provided through the State Fund for Market Regulation (SFMR). Pol’nobanka will contribute the remaining DM 20 million (EUR 10.3 million), and will continue to manage the programme.
Hans Christian Jacobsen, Director of the EBRD’s Agribusiness team, said: "Following the successful implementation of last year’s programme, which was the first project aimed at providing financing against warehouse receipts, the EBRD is pleased to provide funding for the 1999/2000 season. The lessons learned in the Slovak Republic, the first country where this type of financing has been available, have been followed this year in Bulgaria. In addition, the EBRD aims to provide similar facilities to other countries within its countries of operations."
FrantiĊĦek Palic, Chairman of the Board of Directors and General Director of Pol’nobanka, added: "We are pleased to see the benefits of several years of work with the Ministry of Agriculture, with which we have cooperated in establishing an institutional framework to successfully lend against warehouse receipts. During the first season of lending we have been able to see the tangible benefits of warehouse receipts and we expect the 1999/2000 season to be even more successful."
Ivan Rosival, State Secretary of the Ministry of Agriculture said: "Warehouse receipts are a key feature of our agricultural policy. Use of these will further increase the sources of financing available to our farming community, reducing the impact of carrying costs and seasonal price fluctuations, without distorting the functioning of the markets. By providing the EBRD with an implicit guarantee through the SFMR, we have enabled the Bank to assist in the financing of warehouse receipts."
Pol’nobanka is the largest active provider of financing to the agribusiness sector in the Slovak Republic. Founded in 1990, it has become the fifth-largest bank and one of the largest private financial institutions in the country. It is based in Bratislava and has 16 branches and 20 sub-branches. The EBRD has been a shareholder of Pol’nobanka since 1993, with 20 per cent of its capital.
The EBRD was established in 1991 to aid the transition from centrally planned to market economies in central and eastern Europe and the Commonwealth of Independent States (CIS). The EBRD is owned by 60 shareholders: 58 countries, the European Investment Bank and the European Community, and operates with ECU 20 billion in authorised capital. It has considerable experience within the agribusiness sector, having already signed 103 projects, amounting to more than EUR 1.85 billion, to assist the sector throughout the EBRD’s countries of operations.
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