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EBRD €3 million credit line boosts Bulgarian micro and small businesses
Union Commercial Bank (Unionbank) is the first bank in Bulgaria to benefit from a finance facility launched last year by the European Bank for Reconstruction and Development (EBRD) and the European Commission. The €3 million credit line, signed today, aims to promote the growth of Bulgaria’s small and medium-sized enterprises (SMEs).
Unionbank will also benefit from a substantial technical cooperation package aimed at developing its SME lending programme, as well as a grant to help cover the costs of building this business. Both are being funded by the European Commission's Phare programme.
"The EBRD credit line will provide urgently needed funding to small and medium-sized businesses to ensure the sector’s further growth," said Steven Kaempfer, the EBRD’s Vice President for Finance. "As one of the privately founded commercial banks in Bulgaria, Unionbank might also encourage other local banks to follow its example and join the programme. Therefore, Unionbank can be regarded as a good partner to work with in the process of SME and banking sector development in Bulgaria, which in turn will help the country’s integration into the European Union."
With a five-year maturity, the credit line will allow Unionbank to incorporate lending to SMEs into its ongoing business. EU-Phare’s two-year technical cooperation programme will provide long-term credit advisers and experts in various fields, and cover staff-training costs at the start of the lending programme.
Unionbank was registered as a universal bank in 1994 with its headquarter in Sofia. Unionbank currently has branches in four major Bulgarian cities.
Phare is currently the main channel for the EU’s financial and technical cooperation with the countries of central and eastern Europe. Along with funds provided during the course of privatisation and restructuring, Phare commitments to SMEs between 1990 and 1998 amounted to €12 billion.
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