EU/EBRD PHASE II EXT. - SME FINANCE FACILITY FRW

Location:

Regional

Project number:

19657

Business sector:

Financial institutions

Notice type:

Private

Environmental category:

FI

Approval date:

04 Sep 2001

Status:

Completed

PSD disclosed:

04 Sep 2001

Project Description

Extension to the EBRD-EU regional finance facility for ten EU accession countries (Bulgaria, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Romania, Slovak Republic and Slovenia). The facility provides term loans and equity finance to financial intermediaries to facilitate the expansion of lending to small and medium-sized enterprises (SMEs).
The EBRD will now further extend the programme to include independent leasing companies and leasing subsidiaries of selected banks in the accession countries. The Board of Directors approved the expansion on 4 September 2001.
Fourth extension: EBRD Board approved an additional €125 million for the loan window and a leasing window.
Fifth extension: EBRD Board Approval is sought for up to €150 million additional debt for banks and leasing companies.
 
The project aims to support the growth and development of private sector SMEs by creating access to term loans or equity. It will also establish new business financing practices in financial intermediaries so that these acquire more experience in dealing with SMEs and create a revenue stream.
 

Transition Impact

Medium-term funds to SMEs are only available in rare cases; the weakness of the financial sector is even more conspicuous at the level of very small enterprises. The project will help to create employment opportunities in the private sector.

The Client

Further financing will be channelled through intermediaries in ten EU accession countries that can demonstrate a satisfactory level of financial viability, a capable management team and commitment to small and medium-sized enterprises SMEs in their lending/investment policy.

EBRD Finance

Phase II: The EBRD allocated an additional €450 million to the €125 million already provided for the loan window; the Bank is also providing €21.25 million to an equity window, which is supplemented by €21.25 million equity financing from the European Commission.
 
Addition to Third Extension: EBRD Board Approval is sought for an additional €125 million for the loan window and a leasing window.

Project Cost

EBRD debt funding for banks and leasing companies amounts to €575 million, and financing for investments funds equals €21.25 million. EC supports the banks and the leasing companies with €85 of which €42.5 million is for technical cooperation. EC resourses available for equity funds account for €21.25 million.
 
Maximum sub-loans will be up to €125,000 (exceptionally, €150,000) and maximum amounts for equity participation will be €1 million.

Environmental Impact

Financial institutions included in the facility will be required to apply the EBRD’s Environmental Procedures for Financial Intermediaries to all loans and investments supported through the facility. In implementing these procedures, the financial intermediaries will assess potential environmental issues associated with client SMEs, which are required to comply, at a minimum, with local/national health, safety, environmental and public consultation requirements.

Technical Cooperation

Additional €2 million for a total of approx. €4.5 million. The technical cooperation funds will be used to contribute to institution-building within the financial sector of the ten accession countries by providing training and technical assistance to banks in order to build long-term capability to provide SMEs with access to financing.

Company Contact

 

Business opportunities

For business opportunities or procurement, contact the client company.

For state-sector projects, visit EBRD Procurement: Tel: +44 20 7338 6794
Email: procurement@ebrd.com

General enquiries

EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com

Public Information Policy (PIP)

The PIP sets out how the EBRD discloses information and consults with its stakeholders so as to promote better awareness and understanding of its strategies, policies and operations. Please visit the Public Information Policy page below to find out how to request a Public Sector Board Report.
Text of the PIP

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