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EBRD demonstrates ongoing commitment to Poland’s small and medium-sized enterprises
A EUR 10 million credit line from the European Bank for Reconstruction and Development (EBRD) to Pierwszy Polsko-Amerykanski Bank S.A (PPABank) will promote the growth of Poland’s small and medium-sized enterprises (SMEs). Provided under the SME Finance Facility signed by the EBRD and the European Commission in April 1999, this financing is the third facility to a Polish bank. It follows EUR 10 million credit lines extended to Wielkopolski Bank Kredytowy at the end of 1999 and to Bank Slaski earlier this month.
PPABank will also benefit from a technical co-operation package aimed at developing an SME lending programme and a grant to help cover the costs of building this programme. Both are being funded by the European Commission.
Kurt Geiger, the EBRD’s Business Group Director of Financial Institutions, said: "Considerable interest has been expressed by Polish financial intermediaries as they begin to appreciate the growth potential associated with the development of small and medium-sized businesses. In line with its mandate to foster the transition to market economies in central and eastern Europe, the EBRD remains fully committed to encouraging banks in their proactive approach to reach micro and small enterprises."
"Since the beginning of its activity, PPABank has focused on supporting small and medium-sized businesses. This has led to rapid development of the SME sector," said Marek Kulczycki, PPABank’s President. He continued: "SMEs represent 98 per cent of all Polish companies and employ three-quarters of the working population. There is a great demand for the EBRD’s credit lines from this dynamic sector of the Polish economy."
The EUR 10 million credit line will have a five-year maturity and will enable PPA Bank to increase its lending activities to SMEs. It will also provide much-needed term funding to SMEs to ensure the sector’s further growth. The EU-Phare’s two-year technical co-operation programme will be used to provide long-term credit advisors and experts in various fields and will also cover staff training costs at the start of the lending programme.
Established as the Krakow Banking Society in 1990 by an independent association of entrepreneurs, the company changed its name to Pierwszy Polsko-Amerykanski Bank S.A. in 1991 after the Polish-American Enterprise Fund (PAEF) became a major financial investor. In 1997 Generale Bank of Belgium, which has subsequently consolidated with other subsidiaries of the Fortis Group, became a shareholder in PPABank and in September 1999 replaced PAEF as a majority shareholder. PPABank, which will soon change its name to Fortis Bank Polska, operates through five regional offices and 16 operating branches in Poland.
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