The EBRD is further increasing the availability of financing to private businesses in Bulgaria with a €20 million loan to Raiffeisen Leasing Bulgaria OOD, part of Raiffeisen Bank International (“RBI”) Group, for onlending to small and medium-sized enterprises (SMEs).
The proceeds of the loan will be used to provide leases to local companies to finance capital investments for the expansion of their businesses. Such capital investments include the acquisition of equipment, light commercial vehicles, trucks and trailers, as well as cars for commercial use.
Leasing provides an important source of financing for SME fixed asset investment in Bulgaria. The local leasing market has been severely affected by the global financial and economic crisis, which led to a sharp decline in new leasing volumes during the past few years.
The project will contribute to the growth of leasing financing in the country and also channel financial support to SME businesses in Bulgaria, which still have limited access to other funding sources.
Raiffeisen Leasing Bulgaria, 100% owned by RBI Group, is one of the leading players on the Bulgarian leasing market, with SME financing accounting for more than 40% of the company’s portfolio. The company has been an EBRD client since 2006 under the EU/EBRD SME financing framework. The current facility is the EBRD’s third financing deal with Raiffeisen Leasing Bulgaria, bringing the total loan amount extended to the company to €40 million.
“SMEs play a vital role in the Bulgarian economy, and the project will contribute to the expansion and further development of the sector. In particular, the EBRD finance will increase access to stable funding for private businesses and help them deal with liquidity problems. At the same time, the project will support the local leasing market and the Bank’s long-term partner Raiffeisen Leasing Bulgaria, helping the company to diversify its funding sources,“ said Daniel Berg, EBRD Director for Bulgaria.
“Raiffeisen Leasing Bulgaria is a strong partner for the small and medium-sized enterprises in Bulgaria. Thanks to this credit line, we will further support local small businesses by providing them with favorable financing conditions,” said Dobromir Dobrev, CEO of Raiffeisen Leasing Bulgaria.
Since the beginning of its operations in Bulgaria, the EBRD has committed over €2.4 billion in various sectors, mobilising additional investments in excess of €5 billion from other sources.
Raiffeisen Leasing Bulgaria OOD is a universal leasing company that offers its services through the branch network of Raiffeisenbank (Bulgaria) EAD. Raiffeisen Leasing Bulgaria is owned by Raiffeisenbank (Bulgaria) EAD (24.5 per cent) and Raiffeisen-Leasing International GmbH (75.5 per cent). Raiffeisen Leasing Bulgaria owns 100 per cent of the shares of Raiffeisen Auto Leasing Bulgaria EOOD. Raiffeisen-Leasing International GmbH is 25 per cent owned by Raiffeisen Leasing GmbH and 75 per cent owned by Raiffeisen Bank International AG, which is also the sole shareholder of Raiffeisenbank (Bulgaria) EAD.