Raiffeisenbank (Bulgaria) EAD and the European Bank for Reconstruction and Development (EBRD) have signed a second EUR 10 million Credit Line to be used to promote the financing of projects of farmers and entrepreneurs from the private sector based in rural areas in the country. The credit line is available under the EU/EBRD SME Finance Facility and is supported with grant funds provided by the European Commission.
The facility will improve the access to finance for farms and small enterprises in rural areas of Bulgaria to expand their businesses. Recipients of the loan can be farmers, small and medium sized enterprises, firms, cooperatives, sole proprietors, or any other legal entities operating in rural regions. The beneficiaries should employ no more than 100 staff, and should have majority private sector ownership and control, as well as annual turnover of no more than EUR 7 million or a maximum annual balance sheet total of EUR 5 million.
“Thanks to this Facility, Raiffeisenbank will ensure continuous support of the business of Bulgarian farmers and entrepreneurs operating in rural areas. The first EUR 10 million Rural Credit Line was successfully implemented by the end-2008 enabling Raiffeisenbank (Bulgaria) to finance more than 770 loans to farmers and SMEs to the total amount of EUR 10.8 million”, said Momtchil Andreev, CEO of Raiffeisenbank (Bulgaria).
This facility is the EBRD’s second EUR 10 million Rural Credit Line for Raiffeisenbank (Bulgaria) and the seventh Finance Facility granted to a member of the Raiffeisen group in Bulgaria. Previous financing facilities provided by the EBRD covered SME finance (both with Raiffeisenbank (Bulgaria) and Raiffeisen Leasing Bulgaria), residential and industrial energy efficiency.
James Hyslop, EBRD country director for Bulgaria: “In these difficult global conditions, the EBRD is providing a loan to Raiffeisenbank (Bulgaria) to continue lending to micro, small and medium enterprises in rural areas that need funding support more than ever before. Raiffeisenbank (Bulgaria) has proved to be a strong partner for the EBRD in increasing support to SMEs all over the country.”
The EU/EBRD SME Finance Facility, a joint programme of the European Commission and the EBRD, supports the development and growth of SMEs by facilitating their access to finance. Under the programme, the Bank will make available funding of EUR 1.35 billion, of which EUR 1.2 billion has been committed to signed projects to date. The EC has contributed EUR 197 million in grant financing since the launch of the programme in 1999.
The EBRD is the largest investor in Bulgaria with over EUR 1.7 billion committed to projects across the country. Working with its many partners, the Bank has mobilised more than EUR 6.2 billion for projects in Bulgaria.