Two guarantee agreements to support Romanian SMEs signed by ProCredit Bank and the EIF under the Competitiveness and Innovation Programme
Bucharest, December 2nd, 2013
ProCredit Bank Romania and the European Investment Fund recently signed the first two guarantee agreements to support SMEs under the Competitiveness and Innovation Programme (CIP). Within the framework of these agreements, ProCredit Bank will offer loans to entrepreneurs with preferential conditions.Thanks to the European Commission, a total loan volume of up to EUR 50 million will be provided to support the development of very small and small businesses in Romania over the next three years. Information with regard to the loan eligibility requirements is available at any ProCredit Bank branch.
EIF Head of SME Guarantee Facility, Gunnar Mai said: "We are delighted to be signing the first CIP agreements in Romania with ProCredit Bank, allowing the bank to increase its lending capacity to small enterprises by offering loans with significantly reduced collateral requirements and reduced pricing expected to reach more than 2,500 entrepreneurs. Thanks to the guarantee offered under the Competitiveness and Innovation Framework Programme of the European Union, companies in Romania will be in a position to increase investments, to grow, launch new products, introduce more efficient processes and create more jobs."
The loans offered by ProCredit Bank under these agreements can be issued in either EUR or RON and may have a maturity of up to 10 years.
Loansfor amountsbetween RON 50,000 and 110,000 will only be granted in RON and can be used for both investment and working capital.In addition, these loans have no collateral requirements and can be accessed for a maturity of up to five years.
Thanks to the European Commission guarantee, loans exceeding EUR 25,000 or the RON equivalent can be granted as either working capital or investment loans. These loans are issued in EUR or RON and have substantially reduced collateral requirements. Working capital loans are granted for a period of up to three years and for a maximum amount of EUR 100,000 or the RON equivalent. Investment loans are granted for a maximum period of 10 years and may be granted in amounts up to EUR 250,000 or the RON equivalent.
There is a funding limit of EUR 100,000 or the RON equivalent for companies with agricultural activity. Repayment plans are flexible (monthly or seasonal), taking production cycles into consideration.
"We believe that this agreement will have a positive impact on very small, small and medium-sized-enterprises in Romania that will be able to access funds with advantageous conditions. Offering its customers competitive financing facilities is a priority for ProCredit Bank, which is looking to help clients invest and grow, thus strengthening the bank's mission to contribute to the sustainable economic development of companies in Romania",says Andreea Enache, Business Development Division Director, ProCredit Bank Romania.
The Competitiveness and Innovation Framework Programme proposes a coherent framework to improve competitiveness and innovation capacity in the European Union. The actions supported encourage the development of a knowledge-based society and sustainable development, based on balanced economic growth.
About ProCredit Bank:
ProCredit Bank is a development-oriented full-service bank. We offer excellent customer service to private individuals and enterprises. In our operations, we adhere to a number of core principles: we value transparency in our communication with customers, we do not promote consumer lending and we provide services which are based both on an understanding of each client’s situation and on sound financial analysis. This responsible approach to banking allows us to build long-term partnerships with our clients based on mutual trust.
In our operations with business clients, we focus on very small, small and medium-sized enterprises, as we are convinced that these businesses create jobs and make a vital contribution to the economies in which they operate. By offering simple and accessible deposit facilities and other banking services and by investing substantial resources in financial education we aim to promote a culture of savings and responsibility which can help to bring greater stability and security to ordinary households.
Our shareholders expect a sustainable return on investment over the long term, rather than being focused on short-term profit maximisation. We invest extensively in the training and development of our staff in order to create an open and efficient working atmosphere, and to provide friendly and competent service for our customers.
In Romania, ProCredit Bank was established in 2002 and it is the result of a partnership between renowned financial institutions – ProCredit Holding and IPC.
About the EIF
EIF's central mission is to support Europe's micro, small and medium-sized businesses by helping them to access finance. EIF designs and develops venture and growth capital, guarantees and microfinance instruments which specifically target this market segment. In this role, EIF fosters EU objectives in support of innovation, research and development, entrepreneurship, growth, and employment. EIF’s total net commitments to private equity funds amounted to over EUR 6.9bn at end 2012. With investments in over 435 funds, EIF is a leading player in European venture due to the scale and the scope of its investments, especially in high-tech and early-stage segments. EIF’s guarantees loan portfolio totalled over EUR 4.7bn in close to 255 operations at end 2012, positioning it as a major European SME guarantees actor and a leading micro-finance guarantor.
About CIP
The Competitiveness and Innovation Framework Programme (CIP), which spans from 2007 to 2013, has been put in place to boost European productivity, innovation capacity and sustainable growth, whilst simultaneously addressing complementary environmental concerns.
Within the framework of the CIP, the European Investment Fund (EIF) has been allocated EUR 1.1bn to be split between venture capital – with the High Growth and Innovative SME Facility (GIF) - and guarantees – with the SME Guarantee Facility (SMEG).
EIF’s investment is funded by the European Union, through the Competitiveness and Innovation Framework Programme (CIP). CIP is a EUR 1.1bn facility managed by EIF, which is be split between Venture Capital and Guarantees. It covers the period 2007- 2013. CIP’s objectives are to generate economic growth and create more jobs as well as boost productivity, competitiveness and innovation in the EU, optimizing the use of European Union funds to support SME’s access to finance
Press contacts:
- ProCredit Bank: Dragoș Calcan - Tel : (+4) 021 201 60 42 - E-mail: ProcreditPR@procreditbank.ro
- EIF: David Yormesor , Tel :(+352) 42 66 88 346 - E-mail: d.yormesor@eif.org