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EBRD promotes mortgage lending in Croatia
€15 million to HVB Bank Croatia to provide greater access to long-term finance
Croatian residents will gain access to long-term financing to buy, build or refurbish residential properties following a €15 million loan from the European Bank for Reconstruction and Development to HVB Bank Croatia d.d (HVBC).
The 12-year EBRD loan, the first of its kind to HVBC, will enable the subsidiary of Vienna-based Bank Austria Group to extend long-term mortgage financing. As well as generating competition in the country's mortgage lending, the loan will help meet the growing demands of residents wishing to purchase or develop real estate.
Kurt Geiger, Business Group Director for Financial Institutions at the EBRD, said the loan will help the bank provide its clients with the opportunity to become homeowners. It will support Croatia's growing mortgage market, making it more competitive, which will benefit local residents.
The EBRD loan to HVBC builds on previous successful cooperation between the two institutions. In 1996, the Bank purchased a 20 per cent stake in HVBC to support its establishment, and in 2000 the EBRD provided HVBC with a €10 million loan to provide medium-term financing to small and medium-sized enterprises.
HVB Bank Croatia d.d is a universal bank with special emphasis on local export-oriented companies and high-income private customers. The bank, which employs more than 170, has 28,000 customers and branch offices in Zagreb, Dubrovnik, Split, Zadar and Rijeka.
Following its acquisition of Splitska banka - one of the largest banks in Croatia - in 2002, Bank Austria Group expects to merge HVBC with Splitska banka by the middle of this year. The new bank will have a market share of around 10 per cent, with some 220,000 clients in 75 branches, giving it a wide reach among the country's population of over 4.4 million.
The EBRD is the largest investor in Croatia, with more than €1.2 billion invested in 56 projects, and has helped mobilise more than €2 billion in foreign investment.
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