The EIF has signed agreements with four banks (Allianz Bank, First Investment Bank, ProCredit Bank and Société Générale Expressbank) under the Joint European Resources for Micro to Medium Enterprises (JEREMIE) initiative to benefit Small and Medium-sized Enterprises (SMEs) in Bulgaria.
With the JEREMIE funding, the four banks will be able to extend loans with reduced interest rates of at least 50% to over 3,300 SMEs across Bulgaria looking to strengthen or expand their businesses. Information on how to access loans financed under the JEREMIE initiative will soon be available from the selected banks.
The JEREMIE Initiative is implemented in Bulgaria within the framework of the OP “Increase of the competitiveness of the Bulgarian economy 2007- 2013″ co-financed by the European Regional Development Fund and the State Budget. The four banks will double the initial budgetary allocation of EUR 130m and channel an amount equal to approximately EUR 260m as low interest rate loans to Bulgarian SMEs.
Commenting on the four operations, EIF Chief Executive Mr. Richard Pelly said “We are pleased to be signing 4 financing agreements in Bulgaria for a product that has been designed specifically in response to the credit crisis. Through our agreements SMEs will benefit from low interest rates and reduced collateral, which will stimulate much needed investment and growth”.
With this new funded instrument with a risk sharing element, the four banks will be provided with financial resources to be on-lent on preferential terms to Bulgarian SMEs and will pass on a substantial financial benefit to the final borrowers. The four agreements result from a Call for Expression of Interest launched in July 2012 which attracted high interest resulting in 17 applications from Bulgarian banks. In order to select the financial intermediaries, EIF proceeded with thorough checks and assessment of the expressions of interest received against set criteria.
EIF is currently assessing the possibility of additional agreements under this instrument.